hi
i have been making some overpayments when i can on my mortgage which is only 1 year into 25 year term. I was browsing the net and found following quote from a website.
"If you have a repayment mortgage, remember to make sure your overpayments are going towards paying off your overall balance, not just the interest. If you overpay on the interest, this will have no effect on reducing your mortgage cost or term."
This is from http://www.money.co.uk/article/1004009-should-I-overpay-on-my-mortgage.htm
Can someone please explain this. what do i need to do when making overpayments?
My lender (post office) reduces the monthly payments whenever i make an overpayment. There is no option to keep monthly payments the same and reduce mortgage term when overpaying.
ta
i have been making some overpayments when i can on my mortgage which is only 1 year into 25 year term. I was browsing the net and found following quote from a website.
"If you have a repayment mortgage, remember to make sure your overpayments are going towards paying off your overall balance, not just the interest. If you overpay on the interest, this will have no effect on reducing your mortgage cost or term."
This is from http://www.money.co.uk/article/1004009-should-I-overpay-on-my-mortgage.htm
Can someone please explain this. what do i need to do when making overpayments?
My lender (post office) reduces the monthly payments whenever i make an overpayment. There is no option to keep monthly payments the same and reduce mortgage term when overpaying.
ta