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should i take the hit on an early repayment fee on my mortgage

Good morning,just after a little advice.I have a mortgage with the Santander and have asked for a settlement figure but unfortunately it occurs a penalty on the account.
I currently pay just shy of £500 pcm on a mortgage of around £70,000 but I am tied in with the product till December 2023,to pay it up early will incur an extra £3500 approximately on top of the £70,000,so I am a little stumped on what to really do for the best.
Any advice would be greatly appreciated.

Comments

  • savingholmes
    savingholmes Posts: 29,017 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Photogenic
    I think more info is needed - what's your interest rate? Eg if you are due to pay more than £3.5K in interest between now and Dec 2023 - you might choose to do it because of that. Can you earn more money putting your £70K into savings than the interest you would otherwise pay? Where has the money come from? Are your pensions sorted? Would getting tax relief on your savings offer a better return on investment? Are you someone who would otherwise fritter the money? Consider whether you need to speak to an IFA. You also posted in the diaries board rather than the main mortgage board which may be why you aren't getting replies. 
    Achieve FIRE/Mortgage Neutrality in 2030
    1) MFW Nov 21 £202K now £172.5K Equity 36.11%
    2) £1.6K Net savings after CCs 14/8/25
    3) Mortgage neutral by 06/30 (AVC £25.6K + Lump Sums DB £4.6K + (25% of SIPP 1.2K) = 31.4/£127.5K target 24.6% 1/9/25
    (If took bigger lump sum = 53.3K or 41.8%)
    4) FI Age 60 income target £17.1/30K 57% (if mortgage and debts repaid - need more otherwise)
    (If bigger lump sum £15.8/30K 52.67%)
    5) SIPP £4.8K updated 29/7/25

  • Thanks for your reply,i have asked my mortgage provider for a projected forecast on my account so I can work out exactly what the intrest will amount to between now and December 2023.My thinking was about putting it into a savings account initially but will see how the figures balance out.I did wonder why it was a little quiet on the resonse front,im not entirely sure how to move it across onto the mortgage forum if im honest,once I get the figures through I will post again.
    Many thanks
  • Thrugelmir
    Thrugelmir Posts: 89,546 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Photogenic
    Lenders won't provide projected figures. Not part of their service to do so. If you have savings. Then nothing to stop you overpaying the mortgage (within allowed limits). Generally speaking as your mortgage balance reduces it becomes less economic to remortgage to a new lender. As the cost of moving does add up. 
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