Overpaying daily?

scotsio

Plan to overpay mortgage by around £600 a month. Just wondered if there is any merit in paying £20 a day to my mortgage instead of £600 a month - would it save any interest since it is calculated daily?

South_coast

If you have the £600 then pay it in one go and you'll save the interest straight away - what would you gain by only paying it off £20 per day?

Newbie_John

Also what's your current interest rate? As it's possible that even overpaying monthly is not the best choice..

lr1277

What is the purpose of making the overpayments?

1) Reduce the amount owed but nothing ese i.e. keep your monthly payments the same

2) Reduce your monthly payment

3) Reduce the term of your mortgage

If either 2 or 3, then it depends on your lender. I used to make overpayments to my Nationwide mortgage. Each overpayment would reduce the amount owed. Only payments over £500 reduced the monthy payment. As I was not interested in reducing the term of the mortgage, I never investigated that option.