19th August 2021 - Sean Banks

Mortgages: to repay or not repay?

If a country’s financial persona could be summed up succinctly, the UK’s would most certainly be defined by our obsession with property, home ownership and mortgages.

As soon as we settle down in a relationship or start a family, most of us become fiercely determined to lay down roots and achieve that sense of pride and security that comes from owning our own bricks and mortar. Then, after working hard to scrimp and save to do just that, the very next thing we want is to pay off the debt used to buy the property in the first place – commonly known as ‘the mortgage’. First, we are desperate to buy our own home. Then, we become equally desperate to rid ourselves of the huge loan lingering above our roof.

No wonder, with most people and couples securing a mortgage for up to 5 x their annual income, spread over 30+ years, the overall cost can be an eye-watering sum of money (I speak from recent personal experience here; my wife and I having just bought our first proper family home together).

For most of us, the family home is the most expensive purchase we are ever likely to make, and we will borrow large sums of money to make the dream a reality. Paying your mortgage off early can be a great way to achieve a sense of financial freedom and independence – you’ll no longer owe anyone money for living in your own house, and you’ll have plenty of spare cash burning a hole in your purse to put towards your family’s future. It’s a no-brainer, right?

Of course, as with most other things in life, there are pros and cons that come with what seems like such an obvious decision. Why wouldn’t everyone want to pay off their mortgage at the earliest possible opportunity? Here are some things you might wish to consider before rushing into anything:

It is difficult to say with any certainty whether it is right for someone to pay off their mortgage early. Everyone has different needs and objectives around which to focus financial decisions. If you or someone you know might benefit from a chat with one of our financial planners, please feel free to get in touch via our contact page.

More articles on mortgages can be found on the BBC Website here.

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