How much to pay off Mortgage

Ignoring interest, you would need to overpay your mortgage by at least £875 per month, to stand a chance of eliminating the mortgage in 2 years, but also watch out for any penalties imposed by your lender, such as maximum overpayments etc.

Could some please tell me how to work out how much i will need to pay per month to pay mine off.

I beleive from the last statement i owe 21000, My current payments are 175 per month I have 13 Years to run. My current intrest rate is %4.94 returning to %6.6 in October 2007.

==== That programme is a joke, in the two I've seen people have done penny-pinching things like get an allotment to grow their own veg and buy store-brand toilet paper, nothing at all that is even within two orders of magnitude of paying off their mortgages. And nothing in the programme itself gives any indication that people will be able to achieve their target. They never, for example, as far as I have seen, do something along the lines of...your mortgage is 200k, so thats 100k a year you need to raise. Probably because it would be blindingly obvious that stuff along the lines of buying Tescos-brand cornflakes wouldnt quite make that sort of saving, so the whole idea is junk to start with.

As to calculating how much to pay yours off, well a rough and ready calculation would be 10,500 (half of your mortgage), plus 5%, each year, all divided by 12 for the per month amount. .

21,000 @ 6.6% over 2 years = 937 per month

Rob Graham

There never seems to be any mention of anyone paying tax on their extra income either; not that anyone seems to have come close to earning any at the moment.

Norm

In message , darrenforward writes

You should increase your payments by £742.03 for the remaining duration of the mortgage. (This assumes that the extra payment is reflected in the interest calculation immediately)

In message , Ian Cornish writes

Dont ignore the interest!

How on earth do you get this figure? You have overestimated the overpayment by about £100.

This is true,

In message , Rob graham writes

I assume those are the total monthly amounts, not the overpayment.

Dont forget that the 6.6% portion is on the reduced balance for the remaining period. The balance will decay at a faster rate for the lower rate of interest so the balance outstanding at Oct 07 is what should be used for the second calculation over 135 months.

Aw shucks... now I got my brain cell in gear, I forgot to take off the current monthly repayment of £175, so *overpayment* of ~£700.

And just to make matters more complex, it does depend a lot on when the interest is being calculated.

Correct

Yes, but I just gave the OP the overall figures to give him an idea of the scale of things. Apart from anything else, the 6.6% might have changed by the time he gets there. Unless he wants total accuracy the repayment amounts do not differ vastly with a change of interest rate.

Rob

Thanks everybody for all your help. I had figured something around the £800 mark.

Kind regards

Darren

I always feel the iognoring of tax issues is a very poor behaviour too.