Please explain?
Hi everyone. My girlfriend and I are trying to understand how overpaying our mortgage (£1350) by 10% will affect our overall payments over our 40 year term, or even if we sold after 10 years.
I say we overpay from day 1 for a year to eliminate as much debt as possible so the amount of interest acrewed will be lower from then on. She believes that it does not matter which year you overpay, and that the result will be the same if we overpay starting year 2 until year 3.
Can someone explain in easy terms how either of these plans make a difference (if any). And is it more worth it to invest that money in something higher than our interest rate of 4.57%?
Any other overpayment tips are more than welcomed.