Should I?.....Shouldn't I?

Kantankrus_Mare

I have been on this site for years and read quite a lot of peoples threads about overpaying mortgage always meaning to start myself.

A bit about us.

We are 49 with live at home children aged 20 and 22.

Got 10 years left on the mortgage which we have just remortgaged to nationwide with a decent 2.54% (65,800)

We also have a rental property which is on interest only mortgage...

Now my shall I...shan't I query is this.

From May next year I could possibly start overpaying by £100 a month....sometimes a little more.

Not a lot but it will knock a couple of years off the last payment date.

I really dont want to be paying a £ 600 mortgage at age 59!


I have also just opened a regular saver account with nationwide that pays 5% (will have tax taken off that)

Would I be as well putting my savings into that for a year and then pay a lump sum off mortgage or is it worth me overpaying as and when I can? Limited to 10% over payments per year.

Really want to see that balance come down.

Thanks in advance for any advice.

Luckyinlife

If you plan to overpay £1200 a year your better off keeping it in the account really as it will earn you more maby overpay the interest at the end of the year

Im on a 2.44% rate myself with a similar amount to you but i overpay as i aim to hit around £300 a month or so hopefully more
My term is over 25 years tho so my normal payments are £290 for the next 2 years anyway

For me i enjoy seeing the mortgage balance coming down so i just overpay :]

If you value seeing the balance coming down more than a bit of interest just pay the mortgage and enjoy doing so :]

You have a lot of capital coming off from your normal payment around £480 so think youd have nearly £600 coming off the capital every month so 1.2k every 2 months :]

May i ask your ltv ? i suppose its good tho as you have a good rate :]

Maximum_Saving

Hello. I think that a regular saver is an excellent way to build up a a lump sum of money. I have one with First Direct. I love the power of overpayments on a mortgage. I am lucky that I am able to pay up to £500 a month as an overpayment every month. You can pay up to 10 percent so you could wait until the end of the year to do a mortgage overpayment. I have been overpaying since 2013 and have paid more than £14,000.

Current mortgage: £25,329
Five year fixed rate at 4.09 percent interest from August 2012
Mortgage free: September 2017

Kantankrus_Mare

Luckyinlife wrote: »

If you plan to overpay £1200 a year your better off keeping it in the account really as it will earn you more maby overpay the interest at the end of the year

Im on a 2.44% rate myself with a similar amount to you but i overpay as i aim to hit around £300 a month or so hopefully more
My term is over 25 years tho so my normal payments are £290 for the next 2 years anyway

For me i enjoy seeing the mortgage balance coming down so i just overpay :]

If you value seeing the balance coming down more than a bit of interest just pay the mortgage and enjoy doing so :]

You have a lot of capital coming off from your normal payment around £480 so think youd have nearly £600 coming off the capital every month so 1.2k every 2 months :]

May i ask your ltv ? i suppose its good tho as you have a good rate :]

not sure what my ltv is but house is worth approx 125,000.

If our original endowment had lived up to expectations, we would have been done and dusted by 2013 but we all know what happened to endowments. Then we borrowed some more for home improvements and then twice more for deposits on buy to lets,

Sold one of buy to lets at a couple of thousand loss but the other is going really well and is somewhere we could possibly downsize to in future when one of the children finally fly the nest.

My main reason for wanting to overpay rather than save .....is that OH would find a home for savings but if it is over paid its done and gone.

Will have to have a think.

Luckyinlife

Your LTV is around 50% :]

Im hoping to get a buy to let myself in my local area in the next year or 2
As part of a retirement plan for me
How are or have you found the whole buy to let saga ?

Did you sell the one at a small lose after a few years rent ?

If it potentially could be spent by OH Id over pay it asap hehe

Kantankrus_Mare

The buy to let we got rid of was originally OH's parents house. They have moved into fishermens cottages.

Initially we had good tenants in both properties but had about a year of bad tennants that left the places in a mess and one lot of tenants that didnt pay rent and we managed to get rid.

The first property needed a lot of money spending to bring it up to date, Central heating....new kitchen....bathroom...so we decided to get rid.

The other one we have had a decent tenant for over a year and she isnt planning on going anywhere. Its a really lovely place as well that needs no major work doing and I could quite happily move in it myself. It gives us options for the future but we took it on as a long term pension plan.

If I knew what I knew now though....not sure I would go down the buy to let route. Can sometimes be stressful and more hassle than its worth.