Paying off 10% mortgage per year vs regular overpayments

flusterbluster

Hello all, recent work changes had me in a spin and I realised with some discipline I could over pay my mortgage.

Taking advice I want to put it into savings in the event of an emergency but, where I can; pay off a significant amount each year. This year I could pay off 10%, next year about the same amount - not necessarily just 10% - and yes, repayment charges I will be careful of.

What I'm really asking is which is better - a regular yearly lump sum or regular overpayments? I assume regular overpayments but this si made difficult by my provider, as in I can't make it a standing order/and direct debit changes impose a fee.

If I pay off 10% a year how quickly will my mortgage be completed? It's for £69,000 now.

Thank you everyone,
Nick

Lokolo

The earlier you pay the less interest you pay.

flusterbluster

Hullo lokolo, thank you but I'm not sure what you mean. As in if I pay before my statement or after it? Are you suggesting I go for regular overpayments as opposed to a lump sum?

edinburgher

flusterbluster wrote: »

Hullo lokolo, thank you but I'm not sure what you mean. As in if I pay before my statement or after it? Are you suggesting I go for regular overpayments as opposed to a lump sum?

Yes, making the OP earlier will almost definitely save you money vs. building up a sum in savings.

flusterbluster

I've set up a standing order (couldn't do that before) to overpay £150 a month.

I'll bung in lump sums as and when I can as well.