2022 Mortgage-Free Wannabes

gillynomad · 26 October 2022 at 1:02PM

x_raphael_xx said:

Hello, I would like to tack on for the end of this year please
I would also like peoples advice... Is it better to OP direct onto the mortgage? Or to save a lump sum and pay off at the end of the year?
My plan was to OP as and when we had funds, but someone told me today that we would save more interest by paying off as a lump sum before remortgaging.

personally, I'd say better OP as and when you have the funds. Pretty sure interest is calculated daily on the balance so once you've OP you'd have a smaller balance for interest to be calculated from - although I've never done the numbers to work it out...

(Think this only doesn't make sense if you can find a savings account with higher interest rate than mortgage so saving and then making a lump sum OP may be better...there's some articles on here that would explain that process better though!)

x_raphael_xx · 26 October 2022 at 1:53PM

gillynomad said:

x_raphael_xx said:

Hello, I would like to tack on for the end of this year please
I would also like peoples advice... Is it better to OP direct onto the mortgage? Or to save a lump sum and pay off at the end of the year?
My plan was to OP as and when we had funds, but someone told me today that we would save more interest by paying off as a lump sum before remortgaging.

personally, I'd say better OP as and when you have the funds. Pretty sure interest is calculated daily on the balance so once you've OP you'd have a smaller balance for interest to be calculated from - although I've never done the numbers to work it out...

(Think this only doesn't make sense if you can find a savings account with higher interest rate than mortgage so saving and then making a lump sum OP may be better...there's some articles on here that would explain that process better though!)

Thank you.
From my statement the interest charged each month is slightly less after each regular DD payment. So I would assume as I OP, the interest will keep dropping & therefore each OP would make more of a difference.
I can see the reasoning behind a lump sum if like you say the savings rate was higher, or we had reached our 10% allowance.

x_raphael_xx · 26 October 2022 at 9:35PM

I assume its daily, according to the statement, the interest charged reduced each month by about 40p as the DD payment was credited.
We overpaid once (we had a dd payment go out when remortgaging and just kept it in as an OP) and the monthly payment was reduced.
I don't have an online account, so will need to ring them to OP, so I'll ask them then re: what the 10% is based on. And if we can keep the dd amount the same rather than reducing.

julicorn · 27 October 2022 at 3:32PM

Trundley27 said:

@julicorn Thanks. My last two months overpayments were £300, but with a target for November and December to be £500 P/M until end of the year.

After that minimum £500 per month and additional various payments above that subject to month per month basis.

After I get a number what do I need to do?

Ash

You've got #97 now, and I've logged your target as £1600 (including your September and October overpayments). Just post in this thread when you make an overpayment. I'd also recommend reading the detailed post on page 1, it tells you a bit more about the challenge and how it works.

julicorn · 27 October 2022 at 3:37PM

Trundley27 said:

@julicorn Think you might have missed my previous post to join with my overpayment target for the rest of the year, awaiting a number, thanks.

Ashley

Nothing missed, I just don't run this challenge as a full time job. So sometimes there'll be a couple of weeks between updates.
(signed: Juli, currently on holiday and still posting an update)

julicorn · 27 October 2022 at 3:40PM

gillynomad said:

Hi @julicorn, it would be great if I could join on this! (Been stalking MSE forums for awhile...but only just bitten the bullet to sign up.)

My target for the rest of the year (Oct - Dec) is £1800. Currently my overpayment for October is £350

Welcome on board! You've got #98

julicorn · 27 October 2022 at 3:41PM

x_raphael_xx said:

Hello, I would like to tack on for the end of this year please
I would also like peoples advice... Is it better to OP direct onto the mortgage? Or to save a lump sum and pay off at the end of the year?
My plan was to OP as and when we had funds, but someone told me today that we would save more interest by paying off as a lump sum before remortgaging.

Just let me know your target for the rest of the year, and I'll allocate you a number

x_raphael_xx · 27 October 2022 at 5:18PM

julicorn said:

x_raphael_xx said:

Hello, I would like to tack on for the end of this year please
I would also like peoples advice... Is it better to OP direct onto the mortgage? Or to save a lump sum and pay off at the end of the year?
My plan was to OP as and when we had funds, but someone told me today that we would save more interest by paying off as a lump sum before remortgaging.

Just let me know your target for the rest of the year, and I'll allocate you a number

I'm going to aim for £1000 op for the rest of the year. I have an expensive November, but going to do my best!