Which product should we overpay on?

JoJoBean

Hi would really appreciate your expertise and advice please! It’s rather complicated so thanks in advance for reading. 

We have 4 mortgage products with Nationwide (due to a combination of porting when moving and home improvement). The interests rates on the 4 products vary. We have 18 years left to pay and they are all up for renewal in December 2026, at which point we can consolidate and shop around for the best deal. 

In the meantime I’m unsure which to prioritise in terms of overpayments (£200 a month on average). Would you chip away at the one with the highest interest rate? Or pay off what we can on the ones with the lower interest? I feel like I can’t see the woods for the trees. 

Product 1 - £115k @ 5.39%

Product 2 - £5k @ 1.29%

Product 3 - £72k @ 1.29%

Product 4 - £42k @ 1.43%

Thanks for your thoughts and for making it this far!

MorningcoffeeIV

Highest interest rate if you want to save the most money.

Lowest if you want to save the least.

SaverRate

Highest interest rate being paid first will save you money.

However, some people like to see their borrowing reduce so if you prefer this start with the smallest loan then work your way up. 

JoJoBean

Saving money overall is the goal. Thank you for your replies!

alanyau88

You need to be sure of the terms and conditions of your mortgage and that there are no penalties if you overpay early.  Please check to see if you have any Early Repayment Charges first and how much that is before you can calculate if you can save any money by paying the particular mortgage product off early.

MFWannabe

JoJoBean said:

Hi would really appreciate your expertise and advice please! It’s rather complicated so thanks in advance for reading. 

We have 4 mortgage products with Nationwide (due to a combination of porting when moving and home improvement). The interests rates on the 4 products vary. We have 18 years left to pay and they are all up for renewal in December 2026, at which point we can consolidate and shop around for the best deal. 

In the meantime I’m unsure which to prioritise in terms of overpayments (£200 a month on average). Would you chip away at the one with the highest interest rate? Or pay off what we can on the ones with the lower interest? I feel like I can’t see the woods for the trees. 

Product 1 - £115k @ 5.39%

Product 2 - £5k @ 1.29%

Product 3 - £72k @ 1.29%

Product 4 - £42k @ 1.43%

Thanks for your thoughts and for making it this far!

As long as you can make overpayments then product 1 as highest interest 
Otherwise put the £200 into as high an interest savings account you can get and then pay off product 2 when the fix is up