Need to get back on top of things !!

monday_blues

Hi there folks, I'm hoping some of you kind people can offer a little bit of advice.

After a very ropey, probably 5-6 years, having to take drastic step to tackle debt problem after selling business in the middle of recession, we are coming out the other side. During this difficult period we had to convert our mortgage onto interest only, £140k total, but split into 4 different parts with different rates, probably 2 or 3 of these parts being interest only on longer term than we would have had, should we not have experienced tough times.

Given the fact we have just paid off everthing and starting to see a bit of light at the end of the tunnel, I want to get mortgage back on track (eventually) but also need some repairs done in property which were put on hold during this period I spoke of. Anyone any suggestions whether should :-

a) convert remaining parts on to repayment all in one go, or
b) do it in parts

and how to eventually reduce term down, how can we do this without throwing every penny at it and not seeing the benefit of the little surplus of cash every month, should we:-

a) aim to reduce the term every couple of years by a couple of years, or
b) overpay once per year, annually (by putting money aside to do this)

At this point in time I don't really want to speak to a professional, as its all still quite raw. I'd like to get on a better footing in the next year or two before people make judgements, which they inevitably do. Hope you understand my thinking and logic here, would be grateful for any comments or anyone who has ever been in this kinda predicament before.

Many Thanks, Monday blues

ACG

Every pound you overpay will make an immediate impact on how much you owe and how much interest you accrue each month. If you overpay by £10 its not going to make a huge dent, but how much you will need to overpay by will depend on the size of your mortgage and the rates.

What you could do is look at a mortgage calculator, for each part put down the balance and the rate and then choose how many years you want the mortgage to be over. That will then show you what your repayments would need to be on the current rates you are paying.

Whether you can overpay by that amount is another potential issue, some lenders allow limited overpayments (typically 10%) others do not and others allow unlimited. You need to check your Mortgage offer or speak to a lender.