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Interest only mortgage & Overpay, Endowment or High Interest Savings Account

We have an interest only mortgage on £170k

Is it better to Overpay, to have an Endowment Policy or put the money into a High Interest Savings Account?

Any advice appreciated.
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Comments

  • Thrugelmir
    Thrugelmir Posts: 89,546 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Photogenic
    What rate of interest are you paying currently?
  • Interest rate is 2.5% for £165k

    Interest rate is 2.25% for £5k
  • zenshi
    zenshi Posts: 1,142 Forumite
    Part of the Furniture 500 Posts
    May I just ask.....you have the capital to hand?
    LBM.....sometime in 2013 £27,056. 10 creditors
    June 20.....£7,587.....3 creditors left 72% paid

    £26,200 on interest only part of mortgage (July 16)...will chip away £17,103
    £49,200 repayment mortgage ( July 16) £37,764
  • zenshi wrote: »
    May I just ask.....you have the capital to hand?

    Sorry to sound silly, but what do you mean?
  • zenshi
    zenshi Posts: 1,142 Forumite
    Part of the Furniture 500 Posts
    You borrowed 170 k on interest only rather than a repayment etc. Capital meaning do you have that money stashed somewhere to pay mortgage off without selling house.

    I'm asking as I'm trying to move mortgages but having difficulty because I don't have 26k to hand, which is on interest only basis
    LBM.....sometime in 2013 £27,056. 10 creditors
    June 20.....£7,587.....3 creditors left 72% paid

    £26,200 on interest only part of mortgage (July 16)...will chip away £17,103
    £49,200 repayment mortgage ( July 16) £37,764
  • Ah, ok, I'm with you now. No, we put money aside each month but looking for something better (if there is such a thing!).

    I'm sorry i'm unable to help you.
  • zenshi
    zenshi Posts: 1,142 Forumite
    Part of the Furniture 500 Posts
    So, in effect you are saving to achieve the amount borrowed for when you have to pay?!

    Wish my mortgage provider was more flexible

    I hope you get the answers you need
    LBM.....sometime in 2013 £27,056. 10 creditors
    June 20.....£7,587.....3 creditors left 72% paid

    £26,200 on interest only part of mortgage (July 16)...will chip away £17,103
    £49,200 repayment mortgage ( July 16) £37,764
  • Basically, yes. Although, I wish we'd have decided on a Repayment option.

    I had no idea we could actually overpay. I only found out by reading the Annual Statement in more detail that usual.
  • chelseablue
    chelseablue Posts: 3,303 Forumite
    Part of the Furniture 1,000 Posts Name Dropper
    Is it possible to switch to Repayment?
  • Is it possible to switch to Repayment?

    Not 100% sure tbh. We got a self-certified mortgage (DH is self-employed) and things have completely changed since since then.
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