Mortgage Query

[bentaxle]

If I have a mortgage of 22k and am a normal tax payer and want to clear my mortgage in the near future is it advisable to leave about 2k outstanding ,
I have heard various opinions on this subject ,Does anyone know for certian
what and why if this is fact

[boxtops]

It depends what penalties you may be on for early settlement. Certainly I was advised to leave a little bit outstanding, then it didn't count as early settlement - mine had quite heavy penalties for settling in varying years.

[factor-fiction]

I can't see any reason to leave £2000 remaining. Some people suggest leaving £1 if it means the bank will store your deeds, but I'm not sure the deeds are needed now. Some also suggest it may be easier to get a further loan later for house improvements if you already have a small mortgage.
Have you checked whether there is an early repayment fee?

[boxtops]

You don't need the deeds, factor - the Land Registry now stores everything electronically, but it still feels nice to hold the deeds in your hands!

[madmaggot]

You need to look at your mortgage agreement Ben.
Also, there may be a 'better' time to pay the figure into the account according to how your interest is calculated ie annually or daily.
If you don't understand the implications of the agreement do get someone more knowledgeable to look at it for you, it could make a big difference to the interest charged.

[factor-fiction]

Although it's a good feeling to pay off the mortgage in full it's worth checking that it's financially worthwhile. If you have a very low rate mortgage of around 2% (mine is base rate +0.99% so I pay 1.49%) and you are a non taxer you may be able to get an account which pays gross interest of say 3%). However the difference is not great and for peace of mind you may just want to clear as much of the mortgage now as you can

[bentaxle]

Thank you all for your time and advice The query was my sons who don't use the internet He was amazed there are people out there that gives their time and knowledge so freely
All the best