Monday, 20 October 2008

Pay off your mortgage early

Greed is partly responsible for the current financial state of affairs.

Not only for the reasons that are already springing up in your minds, but also due to the fact that it is not common (enough) knowledge that it is possible to pay off your mortgage early.

Just like when losing weight, when people go on a financial detox, they often need an incentive, like the incentive of saving up for something!

I am sorry, but paying your mortgage in 14 years instead of 25 is a huge incentive, and often you do not even need to overpay each month by as much as you may think.

I am about to remortgage and first on my list of considerations, was choosing a lender who ALLOWS me, penalty free, to overpay. The difference it makes to compound interest is phenomenal.

Don't just believe me, do some research. Sadly, as it is not in the financial institutions interests you will have to look quite hard. I just Googled the concept and was very disappointed to see that the highest ranked link was from 2005. See:
Read this!

Let's create a movement and all pay our mortgages earlier.

Anyway, back to my opening statement, greed! If the banks had made this more common knowledge more of our money would be with them, instead of in restaurants and bars, and maybe their foresight and lack of greed (for the compound interest) would have led to them being better off now, and maybe less reposessions...? Just a thought.........

Happy to debate it though!

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