Redundancy and Mortgages

Mr_Falling_Star

I am going to be made redundant in a few months and will receive around £36000:j I don't have a very well paid Job at the moment though, my job pays around £17200 per year.

I really want to bring my Mortgage down as its just a pain at £440pm (on a £67500 loan over 35 years 33 years left) but as I get the push at Xmas time I know I probably won't move straight in to a new job so I want to keep some as bills etc need paying.

If I pay my mortgage by £1000 per month until I am settled in a new job (a £560 overpayment) will my monthly repayments go down on a month by month basis or do they set a new repayment level every year? When I am settled I plan to pay £25000 of the total mortgage.

What do you think?

Trying_to_be_good

Firstly, make sure you have enough money in an emergency fund in case you don't get a new job as soon as you'd hope to.

Then, check if there is an Early Repayment Charge (ERC) for overpaying on your mortgage. If there is, just keep the redundancy payment to fund the £440pm when you need help to pay it.

If you are able and willing to overpay, you might want to pay a lump sum rather than extra each month - you'd have to work out how much you could afford to set aside for this. You have already thought this through a bit with your suggestion.

You can probably ask for either the monthly repayment to be reduced, or the term of the mortgage.