Should I clear my Mortgage

[Mariella]

Hi Brendan,
This is an update from yesterday with more details.
My mortgage is due to expire in 4 years, 10 months time, 2020. The rate is 3.7% and is variable. Struggling to keep my last child in her final year in college. I'm due to receive a lump sum which would clear it, would you advise that would be a prudent thing to do. The repayments are €1,000 monthly which is crippling me at the moment.

Mariella

 

[mf1]

Without knowing your age, marital situation, family situation ( young kids, kids in college, elderly parents and financial circumstances, no-one can answer that properly.

Perhaps if you followed this link and posted more detail, people would be better able to hep you?

http://www.askaboutmoney.com/threads/basic-information-required-for-the-money-makeover-forum.61289/

I know myself it was always my aim to own my own house and be debt free at the earliest possible opportunity.

mf

 

[elcato]

What rate are you paying on the mortgage ? What are the current repayments ? In general mortgage rates (about 4%) are much higher than deposit rates (about 1%) so if you don't need the money right now then pay it off. Note that if you are in a fixed rate mortgage there may be a penalty claus to clear it early so make sure you are on an Standard Variable Rate mortgage.

 

[Mariella]

What rate are you paying on the mortgage ? What are the current repayments ? In general mortgage rates (about 4%) are much higher than deposit rates (about 1%) so if you don't need the money right now then pay it off. Note that if you are in a fixed rate mortgage there may be a penalty claus to clear it early so make sure you are on an Standard Variable Rate mortgage.

Thanks for that, my current repayments are 1,000 a month on fixed rate. I am married, 50+ with one child in college

 

[elcato]

When is the fixed rate up ? I think you would need to contact the bank and ask them if there would be a break out fee if you paid it off in full. Also what is the rate at the moment.