Questions about Mortgage redemption and overpayment

Giliador

I have a fixed mortgage of £22K untill 2031 with a fixed rate of 1.74% until August 2026, my plan is to pay it back in full before 2026. Should I start 10% overpayments or maybe even over 10% and pay fee and then pay the rest in full in 2026 or just wait until my fixed rate finishes in 2026 and pay it back. Does anyone know what fees should I expect when doing mortgage redemption.

Thank you

Veteransaver

With a rate that low you are better off currently putting any overpayments into a separate high interest account or ISA then paying off a chunk after the fix rate ends.
You'll avoid any early repayment fees too. How much can you overpay without penalty, ie is it 10% of balance or 10% of original loan amount?

Giliador

I'm not sure if it's 10% of current balance or original loan, will check with the bank. I have also requested redemption statement to see how much they will ask me to pay at the moment. I already have both premium bonds and ISA account. I would just like to find the most cost effective way to pay off this mortgage within next 2-3 years.

Archerychick

Exactly what veteransaver said! Put your over payments into savings, earn off the interest and make a lump sum payment once your fixed rate ends. This is exactly what I’m doing, I’m down to about £30k owed, I’m putting over payments into various savings and in the next 21 months I’ll earn an extra £2k!