Overpayment fund larger than mortgage balance.

andrewboast

Hi
We have a flexible mortgage with Santander and there is more money in our overpayment fund than we owe. I was informed on the phone that withdrawals from the O/F would increase the mortgage balance. Having withdrawn £2000 over 3 months we have just received our statement and while the O/F balance has reduced by £2000 the mortgage has also reduced by 3 x monthly repayments. Have we been misinformed, can we use the O/F pot to pay off our mortgage?

Thanks in advance
Andrew

dimbo61

You are losing out on interest by having more money in savings than you owe on the mortgage.
Is there any penalties for clearing the mortgage now ?
I would carry on taking the same amount out of the savings pot each month as your mortgage payment.
I would put this money into Cash Isa,s
Once you have built up a good savings pot then consider paying off the mortgage.