Cut Years Off Your Mortgage, Use Our Mortgage Overpayment Calculator To Discover Just How Many!
Posted by: Guest Author / Category: MortgageA lot of people don’t realise but the standard 25 year mortgage term isn’t fixed. It’s not set in stone. If you won the lottery would you keep the mortgage for the full 25 years? I very much doubt it.
Imagine the scenario, you pay 500 per month on your mortgage but you have extra money. So you decide to pay 540 a month. This is just 10 a week extra. What do you think this would do to your 25 year term?
We’ll use a 100,000 mortgage as a test. We have a 25 year term and a 5% interest rate. We pay about 580 per month and end up paying a staggering 175,000 back in total.
Using the example figures we decide to overpay just 20 a month, so we pay 600 every month now. Over the 25 year period we would save 5 thousand and cut a year and a half off the mortgage.
OK, 5 grand doesn’t sound a great deal but using a mortgage overpayment calculator to put in different figures allows us to see what we could save in terms of money and time if we could afford a little extra.
Here’s another example where we pay 50 a month extra.
Ame example figures, but this time we pay 50 extra every month we get nearly 4 years shaved of the term and 12 thousand in cash, saved.
The power of using a mortgage overpayment calculator can show you at the ouset just how better off you could be. It allows you to plan ahead for your future, not the lenders!
Here’s a further example but overpaying a little bit more than we did in the earlier examples.
Same figures, 100,000 mortgage, 5% interest, 25 years but paying an extra 100 per month. Nowe were talking. 21,000 saved and over 6 years off the term. Serious savings later by paying a bit extra now.
OK, you’re thinking that it’s not easy stumping up an extra 100 per month over 18 years which equals an extra 23,000 in overpayments alone.
Considering you won’t have to pay anything for the next 6 years you will have at least 680 every month to yourself. Nice sum of money.
Have a play with a mortgage overpayment calculator and see what you could save, you may be staggered at the savings you could make.
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