Pay off remaining mortgage.

Discussion in 'Mortgages and buying and selling homes' started by discovery101, 19 Mar 2019.

  1. discovery101

    discovery101 Registered User

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    I have moved back to my family home to care for my elderly parent and I have rented out my residence with approx 30k of a mortgage remaining.

    I have the means to pay off the outstanding balance.

    So is it a no brain'er to go and just pay of the mortgage?

    Any advice is most welcome.
     
  2. Brendan Burgess

    Brendan Burgess Founder

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    37,014
    Probably.

    For a small sum like that, tidying up your affairs is probably more important than any tax planning issue.

    You might consider keeping it if you have a cheap tracker. The interest would be 1% and after tax-relief at the marginal rate, that would bring it down to 0.6%.

    If it's a cheap tracker and you might trade up at some stage, then you should probably keep it too.

    But overall, I think that tidying up your affairs trumps the rest.

    Brendan
     
    Gordanus likes this.
  3. discovery101

    discovery101 Registered User

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    18
    Thanks Brendan......sorry for the late reply.
     
  4. discovery101

    discovery101 Registered User

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    18
    Hi Brendan.....just an update my current interest rate is 1.05%.

    Also do you think they should offer me a discount if I pay the balance off early...? there is 8 years left to go on the mortgage.
     
  5. Brendan Burgess

    Brendan Burgess Founder

    Posts:
    37,014
    What I think doesn't matter. They won't offer you a discount as there is such a short term left.

    You can ask.


    Brendan
     
  6. Clare Green

    Clare Green Registered User

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    1
    Hi Brendan, I am in a fixed rate mortgage until May 2020. I am in a lucky position to clear my mortgage in full this summer. Should I clear and would I have to pay a penalty or should I reduce my mortgage by half? Just not sure what is the best way to go about this.

    thanks