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Overpaying your mortgage

Discussion in 'Cardiff City Forum' started by Bernie Clifton, 13 May 2019.

  1. Bernie Clifton

    Bernie Clifton Club and Country Superstar

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    How much do you need to overpay by to make a difference? Mine is 630ish a month and I've rounded it up to 700 and pay that. Will it make a difference in getting it down quicker?
     
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  2. CCFC_27

    CCFC_27 Wales Call Up

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    I think it can do, depends how long the mortgage is set for and what interest you're paying, etc. Not that I'm an accountant, speak to one of them, it's probably worth the cost or people wouldn't use them
     
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  3. Mad Al

    Mad Al Ballon d'Or Winner
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    Paid ours off 6 years early, I chucked everything I had at it just to get rid and be debt free. Was worth the sacrifices made and would do it again if necessary.
     
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  4. TDA

    TDA slightly clapped out ninja
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    It will make a difference whether the interest is calculated daily, monthly or annually. You also need to ensure that I overpayment is applied to the balance immediately not annually.

    I think @Hillyboy61 is the one to aski.
     
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  5. Steve R

    Steve R Ballon d'Or Winner

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    Your Mortgage company should have an overpayment calculator online. Ours does. :thumbup:

    Even an extra £20 a month will make a difference surely?
     
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  6. Joecity

    Joecity Ballon d'Or Winner
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  7. Hillyboy61

    Hillyboy61 Club and Country Superstar
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    Spot on @TDA each lender has different methods of charging, collecting and applying interest. Some need a minimum payment for it to be allocated and when. If the lenders FAQ page doesn't give you the answer Bernie by all means give me a shout. :thumbup:
     
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  8. PlumberAde

    PlumberAde Ballon d'Or Winner
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    Careful you don't overpay too much. Usually it is capped at 10% and you are overpaying by about 11%. It will make a huge difference, but you may be able to get a better return on things like P2P loans.
     
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  9. PlumberAde

    PlumberAde Ballon d'Or Winner
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    Yeah, for mine I would have to pay more than £1000 for it to take effect immediately. I did try and move my 5 year fixed (2 years left) to a 10 year fixed but it would have cost £3k. Interest rates will start rising by the time my deal ends.
     
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  10. Ring Peace

    Ring Peace Football friend
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    Typically if you on a variable rate (that is it has been many years that you’ve had the mortgage) then you should be able to pay off any amount. Just be aware that if you do direct debit, some lenders will periodically review the minimum amount you will pay each by assessing the principle over the existing term.
    I got caught out by that so had to manually work out the ever changing (lowered) monthly direct then pay the difference I actually wanted to pay off each month...anyways I am now mortgage free :thumbup:

    Your lender/banking practice I’m sure will be different so always read the small print!

    Banks are crazy fools!
     
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  11. Jamieccfc

    Jamieccfc Player of the Month

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    I got a year left of my fixed rate, any advise if I should try and stick with a fixed rate or tracker?
     
  12. lardy

    lardy pelanty taker
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    I'd go fixed. The next few years are very uncertain.
     
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  13. Feedback

    Feedback Ballon d'Or Winner

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    Are you really asking whether if you pay more than you have to you will reduce the term of your mortgage?
     
  14. Stantona

    Stantona Club and Country Superstar

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    That's been said for quite a few years now. There will be no Brexit and so things will stay the same. #welshandeuropean
     
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  15. Bernie Clifton

    Bernie Clifton Club and Country Superstar

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    No I'm really asking if the amounts I've mentioned will make a *significant* difference.

    :shrug:
     
  16. TDA

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    Like a few people have said, it very much depends on the small print of your present mortgage deal. Your original mortgage offer should have all of the relevant information regarding how interest is charged and the effect of making overpayments.
     
  17. Bernie Clifton

    Bernie Clifton Club and Country Superstar

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    I know, am syill digging out the paperwork. It's a 10% limit but not sure how the interest is charged.
     
  18. Hillyboy61

    Hillyboy61 Club and Country Superstar
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    Bernie the 10% limit normally only applies during a “special rate” period, such as a fix or discounted rate for the first x years. You’re better off going onto the lender’s website and checking out their faq’s section. If the answer isn’t there then phone them as the frontline staff of the major lenders are very good.
    Your mortgage offer sets out all the info tho, if you can find it. :thumbup:
     
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