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So now it's not worth overpaying the mortgage again!

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    So now it's not worth overpaying the mortgage again!

    When we got our mortgage 2 years ago, rates were about 3-3.5% so we've been favouring mortgage overpayments over savings. But now mortgage rates have fallen to well under 2%, less than you can get on even a boring cash ISA.

    In this situation is there any good argument for continuing to make overpayments or should one put all spare cash into ISAs and savings accounts, and then make a big overpayment when/if things reverse? With the 15k ISA limit and a spouse, maxing out ISAs is now a challenge and the "never take money out of an ISA" adage seems a bit less relevant.

    I quite enjoyed seeing the mortgage tumble in size but doing it just for pride seems a bit daft.
    Originally posted by MaryPoppins
    I'd still not breastfeed a nazi
    Originally posted by vetran
    Urine is quite nourishing

    #2
    Originally posted by d000hg View Post
    When we got our mortgage 2 years ago, rates were about 3-3.5% so we've been favouring mortgage overpayments over savings. But now mortgage rates have fallen to well under 2%, less than you can get on even a boring cash ISA.

    In this situation is there any good argument for continuing to make overpayments or should one put all spare cash into ISAs and savings accounts, and then make a big overpayment when/if things reverse? With the 15k ISA limit and a spouse, maxing out ISAs is now a challenge and the "never take money out of an ISA" adage seems a bit less relevant.

    I quite enjoyed seeing the mortgage tumble in size but doing it just for pride seems a bit daft.

    I am in a legal battle with Santander. The written agreement was that they accepted overpayments but what they actually did was to put the overpayments into a separate holding account that did not gain interest and was not credited against the mortgage. Even worse, they later placed all payments that did not match the exact mortgage payment due in the 0% interest account neither of which I could access. Santander's argument is that I agreed to that during a telephone call. It has also come to light that they have tried the same scam on hundreds of other customers. So far Santander have failed to supply a shred of evidence under the pretext that mortgage was held on a old computer system and they can't extract all the data.
    "A people that elect corrupt politicians, imposters, thieves and traitors are not victims, but accomplices," George Orwell

    Comment


      #3
      Originally posted by Paddy View Post
      I am in a legal battle with Santander. The written agreement was that they accepted overpayments but what they actually did was to put the overpayments into a separate holding account that did not gain interest and was not credited against the mortgage. Even worse, they later placed all payments that did not match the exact mortgage payment due in the 0% interest account neither of which I could access. Santander's argument is that I agreed to that during a telephone call. It has also come to light that they have tried the same scam on hundreds of other customers. So far Santander have failed to supply a shred of evidence under the pretext that mortgage was held on a old computer system and they can't extract all the data.
      Have you gone public?

      I'm sure financial journalists would be very interested in your story.

      And companies don't like bad publicity....
      "You’re just a bad memory who doesn’t know when to go away" JR

      Comment


        #4
        Originally posted by Paddy View Post
        I am in a legal battle with Santander. The written agreement was that they accepted overpayments but what they actually did was to put the overpayments into a separate holding account that did not gain interest and was not credited against the mortgage. Even worse, they later placed all payments that did not match the exact mortgage payment due in the 0% interest account neither of which I could access. Santander's argument is that I agreed to that during a telephone call. It has also come to light that they have tried the same scam on hundreds of other customers. So far Santander have failed to supply a shred of evidence under the pretext that mortgage was held on a old computer system and they can't extract all the data.
        Even if you've exaggerated that a bit I'd agree with Sue Ellen it's publicity they would hate to get, take it to the press. Whatever they were thinking when they tried that on, it's just taking the piss.

        Comment


          #5
          Originally posted by d000hg View Post
          When we got our mortgage 2 years ago, rates were about 3-3.5% so we've been favouring mortgage overpayments over savings. But now mortgage rates have fallen to well under 2%, less than you can get on even a boring cash ISA.

          In this situation is there any good argument for continuing to make overpayments or should one put all spare cash into ISAs and savings accounts, and then make a big overpayment when/if things reverse? With the 15k ISA limit and a spouse, maxing out ISAs is now a challenge and the "never take money out of an ISA" adage seems a bit less relevant.

          I quite enjoyed seeing the mortgage tumble in size but doing it just for pride seems a bit daft.
          I'd agree with all this. It's not a numbers game messing trying to get the extra 0.5% out of it. 6 of one half a dozen of the other and the interest rate really isn't a factor anymore.

          Personally I've opted to keep with the mortgage. I believe I would be in a better place with a lower mortgage when the interest rates start rising. Pay off a much as I can so pay less of the higher percentage when it hits. Might not do for years but that's the gamble... and it's not really much of a gamble as the ISA/Mortgage is so close to call you are hardly losing a lot making the wrong call right now. The money to be saved is in the longer term IMO.
          'CUK forum personality of 2011 - Winner - Yes really!!!!

          Comment


            #6
            I'm kinda stuck with a 4% offset as well. The low rates are tempting but the ISA levels mean I can't do anything with the spare money to make it worth leaving the offset. No wonder RBS won't drop the offset %.Bastards
            'CUK forum personality of 2011 - Winner - Yes really!!!!

            Comment


              #7
              Originally posted by northernladuk View Post
              I'd agree with all this. It's not a numbers game messing trying to get the extra 0.5% out of it. 6 of one half a dozen of the other and the interest rate really isn't a factor anymore.

              Personally I've opted to keep with the mortgage. I believe I would be in a better place with a lower mortgage when the interest rates start rising. Pay off a much as I can so pay less of the higher percentage when it hits. Might not do for years but that's the gamble... and it's not really much of a gamble as the ISA/Mortgage is so close to call you are hardly losing a lot making the wrong call right now. The money to be saved is in the longer term IMO.
              My thoughts were, since I don't have an offset mortgage, that paying it off now means the money is gone - unless I remortgage. Whereas putting the money in savings means I can use it if the need arises, or an opportunity develops, and if the rates change I can dump the money in as an overpayment (my new mortgage offers unlimited overpayments without a penalty) to avoid the pain.
              Originally posted by MaryPoppins
              I'd still not breastfeed a nazi
              Originally posted by vetran
              Urine is quite nourishing

              Comment


                #8
                Originally posted by d000hg View Post
                My thoughts were, since I don't have an offset mortgage, that paying it off now means the money is gone - unless I remortgage. Whereas putting the money in savings means I can use it if the need arises, or an opportunity develops, and if the rates change I can dump the money in as an overpayment (my new mortgage offers unlimited overpayments without a penalty) to avoid the pain.
                Yep, I should have said I have an offset so I have that flexibility so not really an issue. Thing is do you not have to be careful to not get tied in to an ISA to get a decent rate so your money is locked in? Getting the write pair of products such as your unlimited over-payment certainly helps with flexibility.

                TBH the values of money we are talking won't make much difference either way at the moment though.
                'CUK forum personality of 2011 - Winner - Yes really!!!!

                Comment


                  #9
                  Originally posted by northernladuk View Post
                  I'm kinda stuck with a 4% offset as well. The low rates are tempting but the ISA levels mean I can't do anything with the spare money to make it worth leaving the offset. No wonder RBS won't drop the offset %.Bastards
                  I'm in a similar position with a Clydesdale offset, admittedly it isn't for much (sub 25k) and my cash reserves are higher than that by a good bit, but after maxing ISA there's no real benefit to paying it direct to the mortgage.

                  I admit I have thought about moving to a bigger/better place with part of the motivation being to up the offset, in truth that's a bloody silly motive when I think about it

                  Comment


                    #10
                    Paid off our mortgage a few years ago (when I was 38) ... it is such a weight off the shoulders knowing whatever happens you will never be homeless. Just need to pay the bills now ... and buy Mrs W lots of shoes
                    I am what I drink, and I'm a bitter man

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