27 Apr

Mortgage overpayment 'a wise move'

Mortgage overpayment 'a wise move'

Overpaying on mortgages is a good way for those whose monthly repayments have recently fallen to save money, the National Association of Estate Agents (NAEA) has advised.

NAEA chief executive Peter Bolton King said that homeowners in a financial position to exploit the recent cuts in interest rate - such as many of those on tracker deals - should look to do so.

He stated: "Clearly they [people with lowered interest payments] have an opportunity for managing to pay back some of the mortgage, which means there will be less owing when rates go back up again, which they will."

Council of Mortgage Lenders head of research Bob Pannell said that making such overpayments can help those affected by the value of the home dropping below that of the mortgage to build up their equity again.

He said this is an easier thing to do now than in the previous housing downturn in the early 1990s.

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