Mortgage overpayments

Martinslovechild

tsharp wrote: »

I like the idea of the payment going down each month, but I'll see what Nationwide do when i actually start making them.

But this will only ensure that you remain with the duration of your original mortgage agreement.

Instead, why not ensure that your monthly payment remains consistent throughout the term, thus when you apply overpayments, these will be deducted from the balance resulting in your mortgage being redeemed earlier.

Personally, I would want to get rid of your mortgage as soon as possible rather than attempting to reduce your payments and in the process, handing over a wad of interest each month to Nationwide.

djbd1973

Martinslovechild wrote: »

But this will only ensure that you remain with the duration of your original mortgage agreement.

Instead, why not ensure that your monthly payment remains consistent throughout the term, thus when you apply overpayments, these will be deducted from the balance resulting in your mortgage being redeemed earlier.

Personally, I would want to get rid of your mortgage as soon as possible rather than attempting to reduce your payments and in the process, handing over a wad of interest each month to Nationwide.

Especially if interest rates continue to rise. I personally hate the feeling of oweing someone money. If anyone knows about getting rid of a mortgage and saving on the interest payments its Martinslovechild.

Emmy

We have a nationwide mortgage and we pay the £499.99 off each month.... we can also see our balance going down each month (which is fab and inspiring).

We took out a 25 year mortgage in 2000 and we are due to be mortgge free next July (ish, but no later than august).
Emmy

djbd1973

Emmy wrote: »

We have a nationwide mortgage and we pay the £499.99 off each month.... we can also see our balance going down each month (which is fab and inspiring).

We took out a 25 year mortgage in 2000 and we are due to be mortgge free next July (ish, but no later than august).
Emmy

How big was the original mortgage to be able to clear it in five years?

Emmy

54k so not a big one but on one wage for the most of that period i feel we have done well

djbd1973

Emmy wrote: »

54k so not a big one but on one wage for the most of that period i feel we have done well

That is really good. My mortgage is also £54k and I started it in 1998 but I added to it for works to the house of 9k but got it back to £53k and thats on two wages.

Respect to you and well done.

djbd1973

riad wrote: »

I've got a Natwest interest only mortgage at the moment which allows for 10% overpayments per annum.

I think this is the norm with interest only mortgages, unsure about repayment types though.

I have an interest only mortgage with the Abbey and this also allows 10% maximum overpayment

gemma.zhang

I've arranged my overpayment mortgage with Natwest for the house we're buying. It's allowed 10% overpayment, when is that 10% allowance calcualted ? Natwest allows overpayment from the 2nd month, does it mean overpayment allowance is,

(1), 10% of outstanding loan on completion, which is 10% of total loan amount in the first year ?
(2), or 10% of outstanding loan whenever you arrange overpayment ?

Also, overpayment, does it allow lump sum, or only monthly payment ?

Thanks

IveSeenTheLight

gemma.zhang wrote: »

I've arranged my overpayment mortgage with Natwest for the house we're buying. It's allowed 10% overpayment, when is that 10% allowance calcualted ? Natwest allows overpayment from the 2nd month, does it mean overpayment allowance is,

(1), 10% of outstanding loan on completion, which is 10% of total loan amount in the first year ?
(2), or 10% of outstanding loan whenever you arrange overpayment ?

Also, overpayment, does it allow lump sum, or only monthly payment ?

Thanks

You should check with your mortgage lender, however, the mortgage I have allows 10% of my inital mortgage to be over paid each year.
this means if your initial mortgage as 100,567 pounds, you could overpay by 10,056.70 pounds each year (yes the pence is included and does make a little difference (every penny counts))

An important thing to consider is the earlier you make the payments the more you save.
10,000 overpaid at the start of the year saves more than making 12 monthly payments of 833.33 (total 10,000 paid)

Hope this helps

Trying_to_be_good

When I remortgaged in July I asked the broker for one that I could make unlimited overpayments on - I now have a lifetime tracker with Woolwich that I can overpay on as much as I like. And as it's a (good) lifetime tracker, I shouldn't have to worry about remortgaging every couple of years. And it was fee free, with legals paid except for £50!

I'd advise anyone to work out what you want your mortgage to do, and challenge a broker to find it for you - you'll be amazed how good the match can be!