Should I use the overpayments I made on my mortgage to take a payment holiday?

Posted on 6 December 2007

Hello Katie, Like many others I am coming to the end of a 2-year fixed rate; I have the ability to take 5 months payment holiday on the mortgage. Should I go for the payment holiday in the hope that 2-5 year fixed rates will have improved by Spring 2008?

Bryan

Hi Bryan,

Good idea, but it is always a dire shame to use up your overpayments to take a payment holiday. If you really think that rates will have fallen by spring 2008, you should be getting a tracker anyway. No one has a crystal ball for what rates are going to do, but whatever you decide, I would simply urge you to use your overpaid funds wisely. Perhaps you could use them to just underpay instead, rather than missing the mortgage payments all together.

 

Categories: Lower mortgage payments, Overpayments, Payment Holdays, underpayments, Borrowback

 

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