Whether you’d like to increase or decrease your mortgage payments, there may be options available to you if you’re looking for more flexibility. Here are just a few potential ways to change your mortgage payments.
Remortgaging your property
Remortgaging your property can enable you to change your monthly expenses based on your financial circumstances.
If you’d like to free up equity from your property to be spent on a large life purchase such as home renovations or university costs, remortgaging your property will enable you to do so. If you remortgage to release a lump sum of money, you’ll face larger repayments, a longer payment term or both.
Alternatively, you may choose to remortgage your property in order to reduce the amount of interest you owe and pay off your debt sooner. If you have a substantial amount of money in savings, you may decide to put this money towards your home’s equity so you can lower your debt and interest.
Take a look at our guide on how to remortgage your home to learn more.
Overpaying your mortgage
If you’d like to pay off your mortgage sooner but you don’t want to remortgage your home, making overpayments can be a more flexible way of reducing the amount of interest you owe.
Even overpaying by as little as £10 a month can make a huge difference to your debt over the course of your mortgage term. For example, a homeowner with £150,000 in mortgage debt over the course of 25 years and an interest rate of 3.5% could reduce the amount of interest they owe by £1,751 if they overpay £10 a month. This would see them becoming mortgage-free 6 months earlier than they would if they paid their original amount.
Overpaying a larger amount could make a tremendous difference. The homeowner in the example above could become mortgage-free a whopping 5 years and 11 months earlier if they overpay by £150 a month. They’d also save £19,663 in interest.
Payment holidays
If you’re struggling to make your repayments, it’s important that you get in touch with your mortgage provider as soon as possible. By doing so, you may be able to get a ‘payment holiday’ which will temporarily pause your repayments until you’re in a position to start paying them again. You will still have to pay this money back eventually and it’s likely that your lender will add interest to your mortgage balance, resulting in you paying back a larger amount than originally planned.
