A thrifty mother shared her strategy to reduce her mortgage by £1,500. Neesha Craig, 36, residing in Swansea, Wales, with her family, garnered £300 by selling her Samsung Galaxy S23 Ultra and promptly utilized the sum to make an additional payment on her mortgage.
According to a recent survey by musicMagpie involving 2,000 adults, approximately 38% of Britons have at least one unused smartphone stashed away, valued at an average of £250.
Neesha, who manages the financial website TheFunMoneyClub, emphasized the importance of mortgage overpayments, stating that even a modest overpayment can yield significant benefits. She personally traded in her old Samsung Galaxy S23 Ultra for £300, which she then directed to her mortgage provider. This action resulted in trimming two months off her mortgage term and saving £1,510 on interest.
Making a mortgage overpayment involves contributing an extra amount on top of the regular monthly payment. This approach aids in accelerating the mortgage payoff, reducing overall interest costs, potentially leading to substantial savings and shortening the mortgage duration.
However, not all mortgages permit overpayments without incurring fees, so it is advisable to check with the lender. Most fixed-rate deals typically allow up to a 10% extra annual payment. Fees for overpayments on fixed-rate deals usually range from 1% to 5% of the overpaid amount. On the other hand, standard variable rate deals usually permit unlimited overpayments, but verifying with the lender is recommended.
Before proceeding with an overpayment, it is essential to assess priority debts and ensure the presence of an emergency fund. In related news, musicMagpie announced a collaboration with retailer Timpson to facilitate smartphone trade-ins at its nationwide stores. AO World, the owner of Music Magpie, highlighted the convenience and speed of the service, aiming to offer customers a more efficient way to trade in their phones. The service has been tested for four months in over 1,300 Timpson stores, enhancing their existing services such as shoe repairs, key cutting, and dry cleaning.
Customers can visit a Timpson store to trade in their phones, with immediate assessment and fund transfer “within minutes.”