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maximise remortgage?
chumpion
Posts: 2 Newbie
Hi all,
I'm just in the process of remortgaging and have a question.
We are fortunate enough to have our house increase in value during the first four years of ownership.
Whilst considering new offers my first thought was to keep the same monthly repayment, whilst benefiting from a lower rate (due to better LTV) and as such reducing the overall term.
However, I wonder if there is any benefit in reducing the monthly repayment as much as possible, whilst still benefiting from the best rate, and then making overpayments so that the same amount comes out every month, as my original idea?
Im hoping it will minimise the proportion of interest that is part of the monthly repayment, as I assume any over payment is a direct payment of the capital. Am I wrong? Probably...
Thanks everyone.
Chump.
I'm just in the process of remortgaging and have a question.
We are fortunate enough to have our house increase in value during the first four years of ownership.
Whilst considering new offers my first thought was to keep the same monthly repayment, whilst benefiting from a lower rate (due to better LTV) and as such reducing the overall term.
However, I wonder if there is any benefit in reducing the monthly repayment as much as possible, whilst still benefiting from the best rate, and then making overpayments so that the same amount comes out every month, as my original idea?
Im hoping it will minimise the proportion of interest that is part of the monthly repayment, as I assume any over payment is a direct payment of the capital. Am I wrong? Probably...
Thanks everyone.
Chump.
0
Comments
-
It makes no difference.
If you pay £1,000 a month, it will have exactly the same impact on the mortgage balance whether that is the £1,000 contractual payment, or the contractual payment of £750 plus a voluntary overpayment of £250.I am a mortgage broker. You should note that this site doesn't check my status as a Mortgage Adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice. Please do not send PMs asking for one-to-one-advice, or representation.0 -
As Kingstreet says .....
- one advantage: a little flexibility if hard times hit (broken boiler etc)
- one disadvantage: you may take it down to the local pub and blow it like I would !Hi, we’ve had to remove your signature. If you’re not sure why please read the forum rules or email the forum team if you’re still unsure - MSE ForumTeam0 -
OK, brilliant. Thanks for clearing that up, everyone.0
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