Lump Sum, monthly increase in repayments or other option?

B

bren1916

Registered User
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378
Hi Folks,

I'm looking for a bit of advice on whether to pay down a lump sum (10%), increase my monthly payments by 10% on my 10 yr fixed rate mortgage or other option?

Principal remaining = €126K
Term remaining = 12.5yrs
Rate = Fixed at 2.95% over 10 yrs (2.5yrs into this term)
Current repayment = €1,011
Other debts = None (luckily)

I'm allowed pay down €14,700 which I am thinking is the most prudent option but open to advice on this.
As savings rates are pretty much 0% I'm thinking at least I can save some interest by paying a chunk of this principle off.

Thanks in advance,

Bren
 
Yes, if you intend to pay off this money, there is no reason not to pay it off now. Otherwise, you will be paying interest on it.

Which lender?
Did you check if they have lower rates?

It's often cheap or free to break out of a fixed rate.

It might be worth using some of the lump sum to pay a break fee.

Brendan
 
Thanks Brendan, currently with KBC and have switched a couple of times over the last 6-7 years, normally going for the longer term fixed rates. Happy enough with a 10yr rate for under 3% TBH having remembered the exorbitant rates of the 80's :)
 
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