mortgage

LAS1

My 5 year fixed deal ends in January and the cost per month should go down.
Could you please advice when taking out new deal would I be better to take over a shorter time i.e. 4/5 years less and keep the payments the same as I am paying just now on the higher rate or
over the longer period and overpay each month. Thank you

Yorkie1

Nobody can tell you what is best for your situation.

However, things to consider include:
- is your current income pretty stable (as far as you can tell)
- what the maximum overpayment permitted on a product would be
- whether you'd want to pay an amount which exceeded the maximum permitted
- do you have other savings (i.e. do you need to build up a rainy day fund / pension etc)

Overpaying on a low monthly amount requires discipline, whereas higher set payments automatically pay the higher amount. However, the flip side of this is flexibility on the lower amount.