Low Rates = Massive Mortgage Payoff?

globalds

I bought a huge TV ..Upsized on the car and have been holidaying enough to almost keep a year round tan.

These rates are a permanent feature ..No point paying things off.

018125

globalds wrote: »

I bought a huge TV ..Upsized on the car and have been holidaying enough to almost keep a year round tan.

These rates are a permanent feature ..No point paying things off.

Or you could have invested your money in something with a higher return than your mortgage interest rate, and then when rates increase you can pay off your mortgage with the funds.

But don't let me ruin your tan.

catwoman73

I'm another one lucky enough to have a lifetime tracker with interest less than 1% pa. The excess is being saved at between 3 and 5% pa in current accounts, which after April will be tax free, so even better.

michaels

I wonder how the average rate payable on all outstanding mortgages has changed over the period - many have obviously seen 6% becoming 1% on trackers but others have been on svrs that have fallen from about 6.5% to 4% and a few have been forced to take much higher rates if they have less equity.

caronoel

I have been hugely overpaying since 2009.

Its pretty much halved the life of the mortgage on my main residence

Result!

N1AK

wymondham wrote: »

As rates have been so low for a considerable time and it looks like they are not really going anywhere soon (possibly down??)

Although rates have likely that doesn't necessarily mean people, on average, have started paying off their mortgages faster. Aside from which I think you'll find a number of people, myself included, who would challenge the notion that paying off the mortgage faster is taking advantage of the low rate.

caronoel

michaels wrote: »

... but others have been on svrs that have fallen from about 6.5% to 4% and a few have been forced to take much higher rates if they have less equity.

You would be VERY unlucky to see a drop in equity over the past 5+ years if you've been repaying your mortgage while house prices have grown in almost every corner of the country:

michaels

caronoel wrote: »

You would be VERY unlucky to see a drop in equity over the past 5+ years if you've been repaying your mortgage while house prices have grown in almost every corner of the country:

Not now but your chart shows that for considerable periods for some regions.

However my point was actually about those taking out new mortgages where until recently those with less than 25% equity were expected to pay much more over base than had been the case in the 2000's.

carslet

I have been overpaying, for a couple of years now, and it has already knocked years off the term

Dandytf

I've been making small regular overpayments since 2012. (approx 60.00 p/month)

I try to increase the amount of overpayment every few months maybe +10-30

I'm not a person for counting years etc, though the difference in yearly interest paid was very motivational this year when Jan yearly mtg statement arrived) interest is in 3 figures not 4.