Farrell Heyworth Estate Agents help you find your next home, sell your current home or rent out your property. We are a one stop shop because we specialise in Residential Sales, Lettings, Auctions, EPCs, Mortgage Services, Conveyancing and Surveys and Valuations. FH are one of the largest independent estate agency groups, with over 600 Home Sale Network offices and 20 Farrell Heyworth offices in the North West.
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With the ongoing mortgage rate war, there is some debate over whether now is a good time or not to pay off your mortgage early. John French from Mortgage Advice Bureau at Farrell Heyworth Estate Agents, discusses the ins and outs of early repayments. 

Do you have other, more expensive debts?

Credit cards and unsecured loans are prime examples of debts that charge high rates of interest, with some having interest rates that are much higher than that of your mortgage.
It is always more beneficial to pay off these sort of debts before considering paying off your mortgage, being mindful to not revert back to them once you have paid them off.
 
Are you contributing to a pension scheme?

The government now tops up your contributions with tax relief.
And, if your company participates in specific pension schemes, they may also match your payments into a pension pot.
The sooner you begin to pay into a pension pot, the quicker your retirement pot will grow. So, if you find yourself with money to spare, it may be worth considering using your savings to add to your pension for the future rather than pay down your mortgage early.
 
What would happen if you died?

Have you thought about what the monetary consequences would be for your family if you were to pass away?  If you have dependants who rely on your income to cover your mortgage, life insurance can help provide for them if you were to die, so this may be something worth putting your spare money into rather than paying off your mortgage.
 
Will you be charged for overpaying your mortgage?

Ensure that you check your mortgage deal to see whether you will incur any charges. You may need to pay an Early Repayment Charge (ERC), though some lenders allow you to overpay up to 10 per cent a year without penalties.
 
The benefits of overpaying your mortgage

When interest rates are as low as they are now, overpaying on your mortgage will mean that you will have a smaller amount to be charged on when rates do eventually rise.
It doesn’t just mean that you may have to pay less in the future, either. You could possibly pay off your mortgage completely – sometimes years earlier than the original end date.
With prices consistently changing, it is important that you seek the advice of a professional mortgage adviser who can talk you through what is right for your personal circumstances.
 
For further information call into your local Farrell Heyworth office, freephone 0800 389 1666 or visit www.mortgageadvicebureau.com/farrellheyworth.

Your home may be repossessed if you do not keep up repayments on your mortgage.
There will be a fee for mortgage advice. The actual amount you pay will depend upon your circumstances. The fee is up to 1.5%, but a typical fee is 0.3% of the amount borrowed.


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