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No-one is discussing the elephant in the room. By clearing the mortgages early I get an extra Ł1100 in my pocket each month from no longer paying it! Both mortgages will be clear (based on my current monthly overpayments) when I am aged 53, around 5 years from now.
I thank you all for the excellent replies so far. I need to go and check the best savings accounts!
Originally posted by Ryhs Moggy
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As sea shell says, its not what the mortgage is, more your net position then its just a matter of shuffling money between accounts.
For example lets say you have a Ł50k mortgage & have Ł50k in cash.
Your mortgage is 0.92% so you are being charged Ł460 a year in interest.
But the instant access savings rate is 1.45% so you're earning Ł725 in interest.
Now obviously you can get better rates tying money up for longer & with it being a mortgage you're only drip feeding so can put a chunk of that in staggered bonds on 1,2,3 etc years.
The other thing worth mentioning is that paying off mortgage can actually have a negative effect on your credit rating if you have no debts. I paid off my last one & couldnt get a decent credit card for love nor money. New house & new mortgage ive now got several 0% ones for stoozing. Im now mortgage neutral & have no intention of paying it all off. Might drop it to Ł25k or something when my deal ends.