An in-between phase

badmemory

I would want to be very sure there would be no need for the money for a period down the line as any replacement borrowing could well be more expensive.  Think of a realistic future date for no more funds being required & see how much paying off your chosen amount would actually save you if you waited until then.  Also would there be any early repayment costs.  You certainly don't want to be paying off at mortgage rates only to land up paying cc rates as a worst case scenario.  I completely understand why you are considering it though.

PennysIntoPounds

Thank you @badmemory, no OP fines, it's all a bit odd as it's a build mortgage so only gets released in stages, so I'm kinda thinking focusing on it like it's a proper mortgage is the best way to keep sanity but we have the potential to pay off the interest for this stage with the money they loan us for this stage. Which would not only help clarify my financial thinking but would also be a very sweet two fingers up to their engorged interest rate!

jwil

I would want to do it, and I'm guessing the interest rate is higher than you'd get in savings.  However, what if there were unexpected costs for the build you needed to cover?  Would you be able to manage?

PennysIntoPounds

Thanks @jwil, therein lies the hesitancy!
Yep interest over double what savings interest would be.
According to our calculations we should be able to do it but according to our experience every time we think there can't possibly be another surprise cost out of the blue, there is. Surely there can't be any more though 😂
So we might be better off using Mr PIP's salary to pay the interest every month rather than chip away at the capital owing, and then we at least wouldn't be accumulating interest on the interest.
It just pains me to know we'd owe the same amount at the start and the end.
We probably wouldn't want to use sales/surveys/wins for OPs at this stage as we're going to have to remortgage when build is done to pay back other build debts as well as this loan and would prefer to be OPing at that later stage when we know what our actual total accumulated debt is and can think about it in a more considered way.
Hmm. I'm now leaning towards ringfencing the interest and seeing how we go, aka I'll be in a sod it mood on a random day and chuck it on and see what happens 😁

badmemory

All you can do is weigh up the pros & cons as you are doing.  Could you maybe pay some off.  I think a major question is if you do pay it off & something does crop up can you access the funding required.

Baileys_Babe

I feel a good half way house could be to ring fence the interest money, but put it into savings for contingencies, if you do need it less panic if you don't you can pay a chunk off before remortgaging.

doingitanyway

I was thinking the same thing @badmemory it doesn't have to be all or nothing, or does it? Can't you throw what you have on over-paying whilst keeping a bit for things that may/will come up?

It feels closer every time I log in here...

PennysIntoPounds

Thanks @badmemory @Baileys_Babe @doingitanyway

Leaning back to sod it now 😂 
Back of a fag pack calculations suggest it'll be approx 2.4k if we complete before June.
If we don't complete before June then we'll probably have to drawdown the next loan installment anyway.
While 2.4k is a lot of money to us, it'll give me motivation to keep selling and surveying so as to reach as near to that as possible, so that we have the money should it have turned out to be a terrible idea to pay off the interest. Then Mr PIP's salary can go towards paying off the capital on this loan installment and we'll have approx 2k less to pay in total...

PennysIntoPounds

Usuals

Steps, submitted a couple of Youspots

Half wussy situps

Listing

Bit of a sort-out

WoB money, shares to usual pots
Aim £10500
Got £404.00

Dinner is using up some need-to-be-used eggs in omelettes 

KajiKita

I’m with doingitanyway, its starting to sound tangibly close …

When will you allow yourself to get excited …? 😊

KK