Cashing Endowment:put towards mortgage or use for home improvements?

snapyou

I have a £27,000 mortgage interest only with the Halifax with 4 years left remaining. I'm on a SVR of 7.49%

I am also thinking of adding another £10,000 for home improvements.

Should I cash in my endowments which,at today's surrender value would give me £14,000 and put it into the mortgage?

Or,remortgage and use the £14,000 from the Endowments to pay for home improvements?

Gorgeous_George

I'd be checking my policy's value month on month (online). IF it is rising by more than my mortgage rate I'd be tempted to keep it providing you think it will continue to perform well.

Then, I'd go for a lifetime offset BR Tracker and borrow as much as I can. Put the surplus in the offset account so it's there if you need it quick - perhaps to snap up a bargain in the auctions.

The experts weill need some more info such as company name, attached bonuses, insurance requirements etc.



GG

snapyou

Gorgeous_George wrote: »

I'd be checking my policy's value month on month (online). IF it is rising by more than my mortgage rate I'd be tempted to keep it providing you think it will continue to perform well.

Thanks but I've already posted about my endowment and following advice here,realise it's time to cash it in.
My question is would I be best to put the endowment cash towards the mortgage OR use it to pay for home improvements?

EdInvestor

snapyou wrote: »

I have a £27,000 mortgage interest only with the Halifax with 4 years left remaining. I'm on a SVR of 7.49%I am also thinking of adding another £10,000 for home improvements.

Should I cash in my endowments which,at today's surrender value would give me £14,000 and put it into the mortgage?Or,remortgage and use the £14,000 from the Endowments to pay for home improvements?

IIRC the minimum mortgage you can get is 25k. What about considering an offset mortgage where you can minimise the cost by keeping your endowment cash and premium money in the account, using it for the home improvements and any surplus to overpay if you want?

snapyou

EdInvestor wrote: »

IIRC the minimum mortgage you can get is 25k. What about considering an offset mortgage where you can minimise the cost by keeping your endowment cash and premium money in the account, using it for the home improvements and any surplus to overpay if you want?

Thanks AGAIN,Ed.You really are a star.
So,are you suggesting that cashing in the endowment and putting it into my mortgage is the way to go in the immediate.
At the moment,i feel i want to cash in the endowment,put it into my existing mortgage(which will take about 10 working days)then use the last couple of weeks in November to get the best mortgage deal e.g an offset as you suggest.


I really need this sorted by end of month

Look forward to hearing your great advice and,once again,thanks for all your advice!

Gorgeous_George

An offset account effectively earns interest at the same rate as your mortgage.

By taking the larger mortgage and depositing your (endowment) savings in the offset account you have immediate access to the funds for home improvements and an incentive to save.

GG

EdInvestor

I suggest as follows:

1.Surrender/sell endowment
2 Remortgage existing loan to an offset mortgage for same amount
3.Use the ex endowment money as the cash savings to offset the loan, also paying in endowment premiums.You can draw on the ex endowment money for your home improvements later, meantime your increased mortgage payments (including the redundant endowment premium) are reducing the loan faster as the cash deposit means that you pay no interest on the matching amount of the mortgage.

snapyou

EdInvestor wrote: »

I suggest as follows:

1.Surrender/sell endowment
2 Remortgage existing loan to an offset mortgage for same amount
3.Use the ex endowment money as the cash savings to offset the loan, also paying in endowment premiums.You can draw on the ex endowment money for your home improvements later, meantime your increased mortgage payments (including the redundant endowment premium) are reducing the loan faster as the cash deposit means that you pay no interest on the matching amount of the mortgage.

Brilliant! Thanks SO much !