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Paying Off The Mortgage

davejjt5
Posts: 26 Forumite

I am due some compensation hopefully soon so wanting to pay off the mortgage. We owe £66000 and I understand they will be charge if we pay it off in full. Can we pay off £65000 and pay off the remaining £1000 say £250 a month?. Not sure how it works.
1
Comments
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It depends whether you have any early repayment charges on your mortgage.
Your original mortgage offer should tell you. Or you can ring and ask.
Before you put it all in your mortgage have you checked what your pension provision is and whether the tax relief would mean that's an attractive option?
There are also savings accounts that may pay better interest than what you save paying off the typical mortgage. All things to think about...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 29/7/251 -
savingholmes said:It depends whether you have any early repayment charges on your mortgage.
Your original mortgage offer should tell you. Or you can ring and ask.
Before you put it all in your mortgage have you checked what your pension provision is and whether the tax relief would mean that's an attractive option?
There are also savings accounts that may pay better interest than what you save paying off the typical mortgage. All things to think about...1 -
davejjt5 said:savingholmes said:It depends whether you have any early repayment charges on your mortgage.
Your original mortgage offer should tell you. Or you can ring and ask.
Before you put it all in your mortgage have you checked what your pension provision is and whether the tax relief would mean that's an attractive option?
There are also savings accounts that may pay better interest than what you save paying off the typical mortgage. All things to think about...1 -
Pension provision
Do you or your partner / other half have a private pension? You can put up to £40K per year into a pension and get tax relief. If you don't have a good pension already - that could be an option. It depends how close you are to retirement whether that's a good option for you and how much you want to clear the mortgage. If you've not been paying much into your pension in the past you may be able to use the £40K from 2 previous years too.
If you wanted to explore that as an option you could post on the pensions board or see an independent financial advisor. Or you could just stick with repaying the mortgage.
You could also look at the top savings accounts if you didn't want to invest
https://www.moneysavingexpert.com/savings/savings-accounts-best-interest/
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 29/7/252 -
SavingPennies_2 said:davejjt5 said:savingholmes said:It depends whether you have any early repayment charges on your mortgage.
Your original mortgage offer should tell you. Or you can ring and ask.
Before you put it all in your mortgage have you checked what your pension provision is and whether the tax relief would mean that's an attractive option?
There are also savings accounts that may pay better interest than what you save paying off the typical mortgage. All things to think about...1 -
savingholmes said:Pension provision
Do you or your partner / other half have a private pension? You can put up to £40K per year into a pension and get tax relief. If you don't have a good pension already - that could be an option. It depends how close you are to retirement whether that's a good option for you and how much you want to clear the mortgage. If you've not been paying much into your pension in the past you may be able to use the £40K from 2 previous years too.
If you wanted to explore that as an option you could post on the pensions board or see an independent financial advisor. Or you could just stick with repaying the mortgage.
You could also look at the top savings accounts if you didn't want to invest
https://www.moneysavingexpert.com/savings/savings-accounts-best-interest/1 -
If you go ahead and clear the mortgage what would you live on?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 29/7/250
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