If you have a mortgage then you may wonder whether it will be a good idea to repay it early. You may have heard about the advantages of doing so and feel that you would like to do this. There are lots of things that you can try which will make it easier for you to repay your mortgage early.
Check any Early Redemption Fees
The first thing to check is as to whether there are any early redemption fees. These are specific fees that some mortgage companies charge for you to repay the mortgage early. They will charge these if you want to make overpayments or if you want to change mortgage provider. These will vary between lenders and some will not charge them at all so you will need to check. You should be able to easily find out by contacting the customer services department. If the fee is very small it could be well worth paying as you will save money in interest payments if you repay it early. However, some will charge a significant amount of money, particularly if you are tied into a fixed rate mortgage. You might need to wait until you have got through that fixed rate period before it is worth repaying. However, you could put together a pot of money in a savings account towards repaying early, which you can use once it is worth you doing this.
It is worth checking to see whether you can save money by switching to a cheaper lender. You will probably find that if you do a price comparison, that there will be lenders that offer mortgages at a lower interest rate than you are paying. If you swap to them, you may find that you can save a significant amount of money on interest and you can use those savings to overpay your mortgage so that you pay it off earlier. Do check how much the monthly payments will be and make sure you fully calculate the total costs and compare that with the total costs of your current lenders to be sure that you will be benefitting from switching. Also check what the monthly repayments will be so that you can work out whether you will be able to afford them.
Pay a Little Extra Each Month
If you can pay a little bit of extra money each month towards your mortgage hen this will really add up. The more of the outstanding balance you pay off, the less interest you will be charged and this will free up more money to pay it off. This means that the more you pay off; the easier it will be to repay. It can start with just a very small amount so even if you are just paying a fiver or tenner extra to start with, this can help. Any money that you would normally have put into a savings account or spent on a treat at the end of the month, you can now use to be able to pay towards the mortgage instead. However, it can be wise to think about whether you are able to get some extra money to be able to do this. The more that you can accumulate the better, so think of ways to do this.
Find Ways to Get Extra Money
Getting some extra money might be easier than you think. Starting with spending, compare the prices on the things that you are buying to see whether you will be able to switch to different brands, suppliers, insurers and providers and save money. If you do this with everything that you buy, the savings can really add up and you could put all of this extra money towards repaying the mortgage. You could also think about whether you need everything that you buy and ask yourself this every time you buy an item so you do not buy things unnecessarily. It can also be worth having a think about whether you will be able to earn any extra money. This could be by selling things you own, renting out a room in your house, monetising your hobby, taking on a second job or doing some online work. There are lots of things that you can try out. It might seem a bit tricky, but it can be fun to try to get extra money and it can feel very rewarding when you accumulate a nice chunk of money that you will be able to put against the mortgage.