Better to overpay mortage or save more?

Skintsaver

My Nationwide mortage 0.94% 
fixed term ends in over 3 years. I have about 90k to repay. I currently have approx 12k of overpayments, which I'm wondering if I should withdraw this, does anyone know if there's a fee for doing so?

I'm currently overpaying by £200 each month, I was thinking of increasing this to £250. My minimum payment is £400. I have 20 years left, though I wish to be mortage free a lot sooner. 

Will I be better off stop overpaying and put the overpayments into a regular overpayment account? Can you recommend one? 

Should I remove my current overpayments (if little or no fee for this) and put into say a isa. 

The in 3 years rejoin the pots of money to payoff the mortage debt would I be better off in 3 years continuing over paying as now, or by putting the money into separate accounts? 

I also have 20k of saving and not looking at making any large purchases soon, I fixed and moved this around earlier in the year. 

Is there any online calculators I can use to calculate the expected debt and interest earnt in 3 years? 

eastmidsaver

i am not an expert in this,  but in terms of the £12k you have already overpaid, i am not sure you can get this back.   i am aware there are certain types of flexible mortgages which allow you to do this,  but generally the interest fee would have been higher.  it is best to speak to your lender about this.

your interest rate is 0.94% and you have 3 years left.   you can get an easy access savings for at least 4%,  or you can fix for around 6%.    you can get regular savers at around 7% allowing you to put in up to £300 a month.

everyone circumstance is different,  but if it was me,  i would stop overpaying,  and save that money instead to earn the interest.   at the end of the fix term mortgage you will have a nice lump sum to make a good overpayment.

keep us posted with what you decide.

Skintsaver

Where have you seen 7% regular savers.

I'm going ask nationwide about clawing back the ovwrpayments I sure it's a term I had, but not really sure how it works...

ColdIron

Skintsaver said:

Where have you seen 7% regular savers.

https://www.moneysavingexpert.com/savings/best-regular-savings-accounts/

Albermarle

Skintsaver said:

My Nationwide mortage 0.94% 
fixed term ends in over 3 years. I have about 90k to repay. I currently have approx 12k of overpayments, which I'm wondering if I should withdraw this, does anyone know if there's a fee for doing so?

I'm currently overpaying by £200 each month, I was thinking of increasing this to £250. My minimum payment is £400. I have 20 years left, though I wish to be mortage free a lot sooner. 

Will I be better off stop overpaying and put the overpayments into a regular overpayment account? Can you recommend one? 

Should I remove my current overpayments (if little or no fee for this) and put into say a isa. 

The in 3 years rejoin the pots of money to payoff the mortage debt would I be better off in 3 years continuing over paying as now, or by putting the money into separate accounts? 

I also have 20k of saving and not looking at making any large purchases soon, I fixed and moved this around earlier in the year. 

Is there any online calculators I can use to calculate the expected debt and interest earnt in 3 years? 

Your question is a very regular topic on this forum and the pensions forum, especially recently. So a trawl through recent threads could be beneficial.eg

Adding to extra to SIPP or paying down mortgage — MoneySavingExpert Forum
Another "mortgage vs pension" post... — MoneySavingExpert Forum

Regular savings accounts
Regular savings accounts 2023: Earn up to 7.5% (moneysavingexpert.com)

AntoMac

https://www.moneysavingexpert.com/savings/best-regular-savings-accounts/

There’s a link above to savings rates from this site.

I echo pretty much all of what @eastmidsaver says. I too would stop overpaying and save towards a big overpayment in three years time. If your non ISA savings interest gets to a certain amount there could be some tax on interest to keep in mind.

I never used to prioritise overpaying my tracker mortgage when rates were very low but I sure am now! That is a great fixed rate you have there. 

phillw

Skintsaver said:

My Nationwide mortage 0.94% 
fixed term ends in over 3 years. I have about 90k to repay. I currently have approx 12k of overpayments, which I'm wondering if I should withdraw this, does anyone know if there's a fee for doing so? 

It will be in your T&C. I had a nationwide mortgage that allowed it, but I'm sure they changed their T&C a bit over the time. I'm pretty sure I had to apply for the over payments and they would credit check me as part of the process.

I (maybe stupidly) went for throwing as much money as I could into the mortgage, because I wasn't sure about my ability to stay in employment. I was in the 40% tax bracket and it was pre-savings allowance. I figured that if I ended up applying for benefits and I had (for example) 90k in savings then they would deny my claim, but if I had a paid off mortgage and no savings then I might get something.

The amount of risk I could tolerate was very likely different to yours.

Skintsaver

So I've done some research since my initial post. Nationwide stopped borrowing back your overpayments in 2010. Which is a shame as I'd be nearly 2.8k better off in 3 years if I was able to withdraw. But If I stop over paying and put into a regular savings account 200 every month at 6% I'd be better off by £800 in 3 years. But I can underpay by say £600(400 usual payment 200 over payment) maybe then I'll be better off but I reality this may look bad in the future I'm not sure? 

So it's probably best to stop the overpayments and find a high interest regular saver.