This is very likely to be your biggest outgoing and over time, your home will hopefully prove to be a profitable investment with the added bonus of countless happy family memories.
Lenders are sympathetic around extending mortgage terms which then reduce monthly payments.
While you should tread with care, as the longer the mortgage term, the more interest you will repay, there would be a case to say that if reducing your monthly outgoings by extending your mortgage term and lowering your monthly mortgage repayment means a family holiday that you otherwise couldn’t afford, this is a great investment in your family life.
In my years of advising clients, I hear time and time again retirees tell me that after a lifetime of being frugal, usually at a time when they were raising their own families, they would gladly have swapped a little of their later-life financial security for more travel or an improved lifestyle when their children had been younger.
One word of caution though – it is my firm belief that mortgage protection, ensuring you are covered in the event of death, serious illness or loss of earnings are in my view essential and that looking to save money by reducing cover may prove to be a seriously false economy.
QUICK WIN: Check if your existing mortgage rate is competitive particularly if you are already on a variable rate or currently nearing the end of a fixed or discounted deal then I’d encourage you to talk to your lender. Renegotiating a deal with your existing lender who is already fully aware of your credit history and track record of making monthly repayments can often take just minutes!
- Disclaimer: Three Counties does not advise on mortgages and debt and this post is for general information purposes only. As a mortgage is secured against your home, it could be repossessed if you do not keep up the mortgage repayments. This blog post was taken from a Three Counties ebook, Your Family, Your Finance, Your Future – click here to download the full guide.
- Writer Bio: Martin Howe is a Director with Three Counties and has over 20 years’ experience in financial services, specialising in all areas of financial planning.