Interest mortgage advice

Philipjj83

Hi, 
I'm on the svr intrest only mortgage rate, which is 0.5% above base i think? 

I save every week and hopefully one day can have enough to pay off the mortgage,
I've 30k an my mortgage total is 87k house is worth 135k 
I like the money in my bank as I have a safety net if anything goes wrong in my financial life. What's peoples thoughts? 

And is there cheaper interest only deals about? Cheers 

tacpot12

I don't know about cheaper Interest-only deals, but I think your approach with savings the money as cash is fine, providing you are on track to be able to save the £87K by the time the mortgage needs to be repaid. If you might expect to be able to save more in future, say due to pay rises, you can factor this into seeing if you are on track or not. You might get lucky if you were to invest the money, but if you are not already investing it, I doubt you will be happy to risk it. You might invest half the £30K, in the hope that the investment performance gets you to the point that you can clear the mortgage more quickly. A Stocks and Shares ISA would be a sensible place to invest this money. As to what to invest in, I would visit the Savings and Investments forum if you think you might want to invest some of the money. 

My advise generally with mortgages is to pay them off asap, so I would review your finances to see if you can save any more than you are currently doing. While you need to live and enjoy your money, you also need to eliminate any risk of losing your house, and this will only happen with you repay the mortgage - so focus on saving hard to clear the mortgage asap.

Please also make sure you are putting something into your pension once you know you are on track to be able to pay off the mortgage.   

amnblog

You are paying 0.6% and you are wondering if there are cheaper deals about. Is £10 a week getting too painful!

dimbo61

Why think ?
Check the interest rate your paying on the mortgage 
Your Not on the SVR if it's 0.5% above the Bank of England base rate which is 0.1% at the moment.
Maybe a tracker deal or the SVR which could be 3.5/3.99% or more.
Great you have £30,000 in the bank but not so good if your earning less than 1% while paying 3%+ on the mortgage.
Now sooner or later the Interest only mortgage needs to be repaid so start paying in down NOW.
Every Overpayment means you owe less and are then overpaying a little bit more.
Getting to retirement with a £87,000 mortgage and no way of paying it means Renting in old age

Philipjj83

I understand that, and at the end of the day I look at it as you have to pay to live, if paying a little more means that I can have the capital money in my bank, im very disaplined with saving. 37yo at the min and I regularly save 800/1000 per month. 

I just like to know if anything goes wrong i have money an the bank doesn't have it.