Repaying your mortgage: Is it a wise decision?

Are you thinking about repaying your mortgage? Then, read on and let us help you with your decision

12:55 21 May 2013

Many people are considering paying off their mortgages. Are you one of them?

Then, let me give you some things to consider before you make that crucial decision.

• Before you consider paying off your mortgage, check first if you have the highest-interest savings account. If you’re not getting much from your current account, checking out other providers would be really worthwhile.

Also, learn about cash and stocks and shares ISAs. See if these are great investment tools for you and if they can offer you with additional income overtime. This may outweigh the interest rates that you’re paying on your mortgage.

• Check if you’re going to pay for overpayment penalties. Some lenders do not actually encourage people to pay off their mortgage sooner. The reason for this is very simple; the longer you pay for your mortgage, the more money they make.

However, if you’re really considering paying off your mortgage, ask about overpayment penalties first.

• Pay off your other debts first. The first thing that you need to do when you’re getting rid of your debts is to eliminate the ones that carry the highest interest rate. Credit card and loans are usually more expensive compared to mortgage.