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Original poster

If you're still on a low mortgage rate

108 replies

Curlewwoohoo · 29/11/2023 07:28

Are you overpaying? Saving? Or just carrying on as normal? Just interested to see if people are taking any steps for when fixed rate ends.

OP posts:
pinkfongg · 29/11/2023 08:07

We've got about £248k left on ours and currently on 1.64% until July 2026.

Monthly payment is £932 a month.
I did some reading and they reckon the interest rate could be 3.5% by 2026 so our monthly payment would be £1200/1300.

To be honest we're not worrying too much because our (painfully) expensive childcare costs will be massively reduced by then, even more than the increase would be on the monthly mortgage payment, but I feel I should be more frugal and do what others are doing.

Can you tell me what kind of ISA's you're using? I'm with Natwest - thank you!

GreatGateauxsby · 29/11/2023 08:08

We are on 2.19 for the next 6 years.

in order, we are:

  • thanking our lucky stars
  • having another baby
  • Putting anything excess into savings vs overpaying
OakTreesAreTheBest · 29/11/2023 08:09

1.3%
It would make absolutely no sense to overpay at that rate as savings accounts pay significantly more. Saving so that there are options when it ends (3. Ore years).

Interested in this thread?

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General money
GetYourBaublesOut · 29/11/2023 08:10

2.78% until July 2025. I do my finances a bit different to how I think others might do them, in that I have a monthly tracker of bills etc going forward 5 years. That means I can input a £300 a month rise into Aug 2025 and then make other adjustments to balance it again, which is what I've done.

£300 represents a rise to about 7% so, in reality, I hope it's lower!

icebearforpresident · 29/11/2023 08:19

I can’t remember my rate just now but I think it’s just below 2% to spring ‘25. I received a large inheritance in 2021 and used £50k of it to overpay the mortgage. I have an excellent mortgage advisor and he found us a mortgage where we could overpay by any amount without charges knowing the money was coming (we were moving house and had hoped the funds would be available by the time we needed it but the timing didn’t quite work out). It cost a fortune to set up but was well worth it. By the time it comes to remortgaging we’ll owe less than £45k and have more saving available to make another overpayment towards the end of the rate to keep our payment pretty much as they are.

Feel incredibly grateful for the money I received and vindicated for taking the 5 year fix when everyone at work (I was an EA at the time we took it out) was telling me I was mad for taking such a long fix and rates wouldn’t move that much.

Blaggingit123 · 29/11/2023 08:24

Fixed at 1.7% til Jan 25. Interest is currently only £160 so it will more than double, but it’s easily affordable at the moment and will be even more so by then so we aren’t doing anything. Will see nearer the time whether it’s worth fixing again or if SVR is more sensible. Not overpaying but likely will do once we get into our 40s.

Flev · 29/11/2023 08:24

We've got another 2 yrs at just over 1% - we have no spare at all at present as my husband is a student, but he finishes this summer so will be working and we'll have an extra salary to help cover the increase when it comes. We deliberately fixed for 5yrs to cover this period - so glad we did as inflation means it's much tighter than we'd expected and mortgage going up would have been impossible to cover.

OhpoorMe · 29/11/2023 08:28

It's not as simple as which interest rate is higher. OP is right to talk about the maths!!

TheOGCCL · 29/11/2023 08:29

We are overpaying. We checked the Martin Lewis calculator about saving v overpaying and it said overpaying is best. Hope to have about £50k left on the mortgage by 2025 and that would be doable given the amount we already pay, but we are also saving and may decide to pay it off. I also think interest rates may be a bit lower by mid 2025.

LadyDanburysHat · 29/11/2023 08:31

We are on 2.2% for another 3.5 years. I always intended to overpay this mortgage anyways as don't want it for as long as the term we got. At the moment I am saving into an account with 5.5% interest, should have £20k to knock off it at the end of the term.

Wendyspotatopeeler · 29/11/2023 08:32

pinkfongg · 29/11/2023 08:07

We've got about £248k left on ours and currently on 1.64% until July 2026.

Monthly payment is £932 a month.
I did some reading and they reckon the interest rate could be 3.5% by 2026 so our monthly payment would be £1200/1300.

To be honest we're not worrying too much because our (painfully) expensive childcare costs will be massively reduced by then, even more than the increase would be on the monthly mortgage payment, but I feel I should be more frugal and do what others are doing.

Can you tell me what kind of ISA's you're using? I'm with Natwest - thank you!

I've gone with Skipton Building Society ISA

I'm impressed so far, very straight forward.

Bonus Cash ISA Saver - Skipton Building Society

Save tax-free in an Bonus Cash ISA Saver from Skipton Building Society. Visit our website to find out more.

https://www.skipton.co.uk/savings/isas/bonus-cash-isa

Tiredalwaystired · 29/11/2023 08:35

Overpaying a bit and saving a little bit. However, we are going through probate as we speak so this will be put into a high interest account when it comes through and then used to pay off a decent chunk.

Caggers · 29/11/2023 08:38

We’re on 2.2% until late 2025 and in the very fortunate position of having the funds in the bank to clear it (due to inheritance, on the downside). So it’s in a fixed term account earning 6% until we need it.

Original poster
Curlewwoohoo · 29/11/2023 08:39

You would need to know the interest cost on the total mortgage over a given time period and compare that to interest on savings in that time, I think? The mortgage interest might be lower than the savings interest rate, but as its a much bigger amount of money it might be more in total iyswim. However, we've chosen to save to still keep the money in our possession...

OP posts:
Heyhoherewegoagain · 29/11/2023 08:42

OakTreesAreTheBest · 29/11/2023 08:09

1.3%
It would make absolutely no sense to overpay at that rate as savings accounts pay significantly more. Saving so that there are options when it ends (3. Ore years).

We also have investments that pay a much higher rate than our mortgage rate so it would be daft for us to overpay

HoneyMobster · 29/11/2023 08:42

We're 4 years into a 10 year fix. I thought DH was mad at the time but he was proved 100% right.

Doesn't make sense to over pay with the low interest rate we have so we're saving into a high interest account instead. We'll probably pay the savings into the mortgage when the fix ends in August 2019.

SirChenjins · 29/11/2023 08:50

Our mortgage will finish when our low fixed rate comes to an end. Thank the gods above. We save separately into a high rate account, no mortgage overpayments.

DeepSownSeeds · 29/11/2023 08:51

@Curlewwoohoo this calculator may help https://www.moneysavingexpert.com/mortgages/mortgage-overpayment-calculator/

you can compare the mortgage to the savings. For us savings won out. We are hoping to be net neutral ie have the same amount in savings as the mortgage when our deal ends in 2027 (5 year fixed) but I don't think we would use all our savings to pay off the mortgage. We will probably use most of it to leave us with a teeny mortgage at the end unless interest rates are stupidly high which might change our mind.

Merrow · 29/11/2023 08:52

Curlewwoohoo · 29/11/2023 08:39

You would need to know the interest cost on the total mortgage over a given time period and compare that to interest on savings in that time, I think? The mortgage interest might be lower than the savings interest rate, but as its a much bigger amount of money it might be more in total iyswim. However, we've chosen to save to still keep the money in our possession...

No, that's not how it works. Money saving expert have some useful calculators (and explanations).

pinkpixie83 · 29/11/2023 08:53

I'm screwed, fixed at a decent low rate until early 2027, but as a single mum my savings are minimal, hoping that by the time renewal is due interest rates should be between 3-4% which I should just be able to manage, my bigger issue is needing to find a lump sum to buy my ex out by 2030 no idea how I'll achieve that one.

PaperDoves · 29/11/2023 08:53

We're on 1.35% until May 2026. Definitely not overpaying, interest on savings is paying much higher than that at the moment.

Original poster
Curlewwoohoo · 29/11/2023 08:54

I'll definitely check the calculators, as you can see my understanding of maths is not too be relied upon... Thank you for the link and info.

OP posts:
Bells3032 · 29/11/2023 08:54

DaisyDoor · 29/11/2023 07:36

We are on 1.3% until 2025. Putting spare cash into a high interest account makes more sense than overpaying now- can get about 5%- then pay a lump sum off when your current deal ends.

This basixally. Also 1.5% until Nov 25. So put the money into isas yeilding 5.7%. seems silly to pay off when interest on the mortgage is so low

AlltheFs · 29/11/2023 08:58

We can’t afford to do anything, no extra money to overpay at the moment. When the deal ends so does nursery so we will just not benefit from that - as the additional mortgage costs will eat it up. Not ideal but not the end of the world for us either.

Anonymouslyposting · 29/11/2023 08:58

We are on 2% until the middle of next year. Not doing anything different - the mortgage is £600k so anything we could do would be a drop in the ocean. Keeping our heads firmly in the sand about it…

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