Retaining Small Mortgage - Pros & Cons

Dancingirl_2

We are in the fortunate position where we could choose to pay off our small mortgage should we wish to do so (without penalties). Someone has mentioned that there are advantages in keeping a mortgage no matter how small & they said they had been told one reason was something to do with not having to sell the house to free up capital in the event of either of the home owners requiring some form of private health care.

Is anyone aware of the Pros & Cons of keeping/getting rid of a small mortgage, bearing in mind the above? Advice would be much appreciated.

scottn

keep a small payment...even a few pounds/pence a month and then you won't have to pay to have them store your house deeds (they are generally stored for free for morgage holders)

scottp_2

That is now pointless scottn; all deeds are stored electronically at the Land Registry so deeds don’t need to be stored securely. Keeping a very small mortgage payment will only cause problems if they come to sell and have to chase up the deeds with the bank/BS before completion. The best bet would be to just contact the Land Registry and confirm they have a copy of the deeds on file and then send them to be destroyed.
As with paying the mortgage off you need to consider both sides. After paying the mortgage off, will you still have enough emergency savings left in case something such as a boiler breakdown or urgent car repair comes up? And also, what is the difference between the interest rates on your savings and your mortgage? I am assuming that as you can pay off without penalty you are on the Standard Variable Rate, which would be hard to beat on savings, especially after tax.
Just think of those and then make your decision, but good luck and congratulations!