Small mortgage balance + short remaining term - WWYD?

[pincher]

Always promised myself that I'd payoff my mortgage by the time I was 50 - been able to do so for a while now but just never got round to it . Now, at 51, I feel like I ought to, if only to belatedly honour my promise.

I've got about £21K left (probably a bit less if I get a settlement figure?) and 18 months to go. Halifax have written to me to tell me that the variable rate is going up to 3.99% from March - the overall interest isn't going to be massive but I just like the idea of not having a mortgage even though I could probably make the £20K work better elsewhere.

WWYD?

[Sarnie]

I'd just leave it, the interest rate will have next to no bearing on a £20k balance with only 18 payments left, almost all of your payment will be capital at this stage.

The time to hammer a mortgage is in the early years when most of the payment is interest.

I would keep my money in the bank and let them take their payments over the next 18 months........

[gotoPzero]

Either.
Pay it off and save the £70 a month with 100% certaintay.
Or put the 20k into VLS100 or VUSA depending on your risk profile and hope it does better than 4%!

[pincher]

Think I just like the idea of having no mortgage.

Can probably get more than 4% over 18 months though, I guess.

Arghhhhhh

[FishAndChips]

Me, I'd just pay it off and be done with it. Why? One less (really important) thing in life to think about. Swan off into the sunset and enjoy the smugness of being debt free.

[Percy Cushion]

Pay it off and save the 3.99% interest, then put the equivalent monthly mortgage payment into an ISA (if not already maxed out)

[pincher]

Well, I decided to completely ignore the mortgage expert's recommendation and paid it off today - will be nice when I see that zero balance letter come through from the Halfax

[Abdul Abulbul Amir]

I would have kept it with some value so the lender will monitor any changes in the registry for you.

From the OP I would have suggested remortgaging with a lower rate and using the £20k as pension contribtions...if you had any spare allowance and you were 40% rate payer.

[pincher]

No pension or ISA allowance left for this year and will max out again for the new tax year later this week.

[Vasco]

pincher said:

Well, I decided to completely ignore the mortgage expert's recommendation and paid it off today - will be nice when I see that zero balance letter come through from the Halfax

I would have done exactly the same.

£20k isn't such a vast amount, and any savings interest is only a little amount earned.

To me, getting rid of any mortgage is a massive benefit, if only psychological.

[pincher]

Vasco said:

To me, getting rid of any mortgage is a massive benefit, if only psychological.

I think the bolded bit is the kicker - as you say, there wasn't a huge amount left and i could probably have made the money work slightly better elsewhere but it's nice to get the monkey off your back, so to speak.

[scot_aln]

Abdul Abulbul Amir said:

I would have kept it with some value so the lender will monitor any changes in the registry for you.

You can do this yourself here - https://propertyalert.landregistry.gov.uk/

Worth the OP doing this anyway

[pincher]

That's useful to know - thanks

[BoRED S2upid]

pincher said:

Well, I decided to completely ignore the mortgage expert's recommendation and paid it off today - will be nice when I see that zero balance letter come through from the Halfax

Congratulations. Must be a nice feeling to owe them nothing and own a house.

[pincher]

pincher said:

Well, I decided to completely ignore the mortgage expert's recommendation and paid it off today - will be nice when I see that zero balance letter come through from the Halfax

BTW - just to clarify, that wasn't a dig a sarnie - more a at myself

[PTF]

BoRED S2upid said:

pincher said:

Well, I decided to completely ignore the mortgage expert's recommendation and paid it off today - will be nice when I see that zero balance letter come through from the Halfax

Congratulations. Must be a nice feeling to owe them nothing and own a house.

Absolutely agree.

For now i'm concentrating on saving into a S&S ISA, rather than overpaying on my mortgage as the rate is only 2%, and i should be able to beat that fairly easily.

But if the time came when the mortgage balance equalled the S&S ISA balance, i'd be really torn. On the one hand if investments are going well and i'm seeing good returns, then why not just keep that rolling. On the other hand.....mortgage free!!!

[mfmman]

I went for offset. The mortgage balance is about the same as the amount of money I like to hold as instant access savings now. The amount of interest I'm losing on the savings is less than half I would pay on the mortgage (0.7% vs 1.85% fixed) and I like the reassurance that I have a lump sum available at any point without having to sell investments etc should I need a few quid in a rush. I'll pay it off completely in two years when the fixed rate ends

[p1doc]

pincher said:

I think the bolded bit is the kicker - as you say, there wasn't a huge amount left and i could probably have made the money work slightly better elsewhere but it's nice to get the monkey off your back, so to speak.

totally agree- i got rid of mine age 45 and nearly 4 yrs later still think best thing to have done-knowledge of knowing I own the house is literally priceless enjoy!

[vulture1]

scot_aln said:

Abdul Abulbul Amir said:

I would have kept it with some value so the lender will monitor any changes in the registry for you.

You can do this yourself here - https://propertyalert.landregistry.gov.uk/

Worth the OP doing this anyway

Can you explain the benefit of the lender monitoring any changes?

[scot_aln]

vulture1 said:

scot_aln said:

Abdul Abulbul Amir said:

I would have kept it with some value so the lender will monitor any changes in the registry for you.

You can do this yourself here - https://propertyalert.landregistry.gov.uk/

Worth the OP doing this anyway

Can you explain the benefit of the lender monitoring any changes?

Did you mean to quote me too rather than Abdul? My link is to land registry and it explains the reasons but primarily fraud risk where no lender marker is linked to record.