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Am I going about this the right way??

edited 30 November -1 at 1:00AM in Mortgage-Free Wannabe
3 replies 511 views
Clarabell1985Clarabell1985 Forumite
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edited 30 November -1 at 1:00AM in Mortgage-Free Wannabe
Hello

I’m wanting a bit of advice on whether to wait 2 years to pay my mortgage balance off or if I should make monthly overpayments.

So currently I am saving up so that in precisely 1 year and 11 months time I can pay the balance of my mortgage off. Deets below:

Mortgage amount 50,500.00
Interest 2.99 - fixed term 5 year mortgage with 1year and 11 months left to go
Mortgage term left 13 years 11 months
Balance at end of the 5 year term will be 38k

Savings 48k
28k of which is in an isa at 3% (BS advised that I can’t put any more money into this as it’s fixed rate for 5 years ending this October and as it’s quite a good rate I’ve left it there so that’s why the full 48k isn’t in there)

My question is should I be using my savings to over pay on my mortgage or does my plan sound ok to pay the balance off in 2years time. My goal is to have another 20k saved by then so I will have money for emergencies. Would anyone pay off now?

Sorry I’m not very financially savvy so would appreciate anyone’s thoughts.

Clarabella

Replies

  • beanieloubeanielou Forumite
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    If I was you I would pay off as much as you can without penalty.
    Lou~ Debt free Wanabe No 55 DF 03/03/14.
    **Credit card debt free 30/06/10~**
    MFW. Finally mortgage free February 2021****
    "A large income is the best recipe for happiness I ever heard of" Jane Austen in Mansfield Park.
    ***Fall down seven times,stand up eight*** ~~Japanese proverb.
    It starts with you, it starts from now. *** It is ok to be me.***
    ***Keep plodding***
    Out of debt, out of danger. ***Be the difference.***
  • unkleunkle Forumite
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    Consider an offset mortgage, same as paying it off but cash is still there for you.
  • zx81zx81 Forumite
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    I'd consider whether paying into your pension is a better option, given the tax advantages.
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