Best way to pay off low mortgage please
Hexham
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I took out a 10 year, £40000 mortgage fixed rate for 2 years. Fixed rate term ends end of this month and I will have a final settlement sum of £31,828.
I have £20k I have saved and would like to use this to reduce the remaining debt to around £12K.
What would people suggest as the best/least expensive way to do pay this off quickly? I can get a personal loan of £12K over 3 years for 3.6% 9meaning the loan would cost me around £600) Thanks in advance
I have £20k I have saved and would like to use this to reduce the remaining debt to around £12K.
What would people suggest as the best/least expensive way to do pay this off quickly? I can get a personal loan of £12K over 3 years for 3.6% 9meaning the loan would cost me around £600) Thanks in advance
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Hexham said:I took out a 10 year, £40000 mortgage fixed rate for 2 years. Fixed rate term ends end of this month and I will have a final settlement sum of £31,828.
I have £20k I have saved and would like to use this to reduce the remaining debt to around £12K.
What would people suggest as the best/least expensive way to do pay this off quickly? I can get a personal loan of £12K over 3 years for 3.6% 9meaning the loan would cost me around £600) Thanks in advance1 
It may be worth looking at what rate your mortgage provider would give you for a product switch fixed for 3 years and compare it to the loan.Credit card debt  NIL
Home improvement secured loans 30,130/41,000 and 23,156/28,000 End 2027 and 2029
Mortgage 64,513/100,000 End Nov 2035
2022 all rolling into new mortgage + extra to finish house. 125,000 End 20361 
Have you considered hanging on to the £20k and getting an offset mortgage?Add the £20k to the offset account and then all overpayments as well and you’re lowering the loan without penalties and keeping a safety net.
Just a thought.Mortgage Jan 2014 £250k
MFW date 2nd Jan 2024
Literally counting the days! 🥳1 
RobM99 said:What's your Hexham said
Not 3.6% for 3 years as in your OP?They want 5 years at 4.9%
What's the mortgage rate? I don't see the point of getting a higher interest loan to pay a low interest loan.The way I'm reading it, the mortgage offer is 4.9% over 5 years, the loan is 3.6% over 3 years.OP, if that's the case then it would make sense  with one big caveat. When you say you can get a loan at 3.6% over 3 years, what are you basing that on? Remember that lenders will advertise "representative" rates which are given to 51% of successful applicants. But each application is assessed on the individual's circumstances and credit history  so you may well find that, even if you're accepted for a personal loan, the APR they offer you could be a lot higher than 3.9%.One other thought  will there be an early redemption penalty for the mortgage? I'm guessing probably not once the fixed rate deal comes to an end, but worth just doublechecking.
1 
Are you making sure you have an emergency fund when you put this 20k into the mortgage?Statement of Affairs (SOA) link: https://www.lemonfool.co.uk/financecalculators/soa.phpFor free, nonjudgemental debt advice, try: Stepchange or National Debtline. Beware fee charging companies with similar names.1

I think another important question is how quickly do you expect to pay off the 12k?Statement of Affairs (SOA) link: https://www.lemonfool.co.uk/financecalculators/soa.phpFor free, nonjudgemental debt advice, try: Stepchange or National Debtline. Beware fee charging companies with similar names.1
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