Capital repayment dilemma

R

Ravima

Registered User
Messages
2,811
With SSIA now matured, should proceeds be applied against standard repayment mortgage or interest only mortgage? i think that the former would produce the greater saving. Am I right?
 
If the loans are for the same amount and at the same interest rate then it doesn't matter if it's an interest only loan or a standard repayment. The same benefit will occur.
 
If one is at a higher rate than the other then you should think about reducing the higher cost loan first. If there are even higher cost debts then these should take precedence. If the interest only loan is in respect of an investment property then you might not want to reduce the capital outstanding since you can write 100% of such mortgage interest off against rental income. In short - more details are required to make an educated comment.
 
You must log in or register to reply here.
Back
Top