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Should We Pay Off Loan And Increase Mortgage Payments.

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Money Talk > Credit & Loans

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tanmaysnv
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Should We Pay Off Loan And Increase Mortgage Payments.  Reply with quote  

The following is a rough outline of our situation.

We currently have an outstanding Credit Union loan of 4,500 on the car and I have around 5,000 in my C.U. account. Current gross repayments are 300 per month.

Our mortgage has about 4 years left on it and we're repaying a little over 300 per month.

We also have about 14 years left on a holiday home mortgage and we're repaying in the region of 700 per month on that.

Both mortgages are on variable rate with PermanentTSB and, due to their recent rate hikes, I'm thinking of paying off the car by transferring money from my Credit Union savings, and then putting that 300 towards the mortgage in extra payments, to shorten the term.

As well as this, we have around 9k in savings. We're hoping to do renovations and put on a sunroom etc., in a few years time. I don't know how much this will cost (maybe 40k or thereabouts). And we're also thinking of externally insulating the house in the near future. I reckon that would cost about about 7k, nett of the grant.

I'm interested in hearing Members' advice on all of this.

Is paying off the car and increasing mortgage payments a good idea? Should we hold off on the insulation till we do the work on the house? Is there a risk that the grants won't be there in a few years? Or should I do something else entirely?

Thanks in advance.
Post Wed May 19, 2010 7:12 am
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jason_simpson
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Using the traditional debt-snowball method, you could focus on paying off the smallest debt first while making minimum payments on the rest.

Using the highest interest method, you could focus on paying off the highest-interest debt first while making minimum payments on the rest.
Post Fri May 21, 2010 4:42 pm
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ed2009
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If you have the money, pay your other debts fast so that you can only focus on the mortgage. Treat it as your regular monthly expenses.

Insurance Life Insurance Good Insurance
Cash Loan
Post Fri May 21, 2010 5:34 pm
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AlFromLA
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I would focus less on mortgage and secured debt and would focus on getting rid of unsecured debt first.
Post Thu Jun 10, 2010 10:51 pm
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pwsolutions
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secured loans and mortgage are more important. because they can hurt your credit score.
Post Wed Jun 16, 2010 2:54 pm
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pwscs
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quote:
Originally posted by pwsolutions
secured loans and mortgage are more important. because they can hurt your credit score.


exactly. your payment history is 35% of your total credit score. so mortgage and loans are more important.
Post Wed Jul 07, 2010 10:46 am
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pwsolutions
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your credit usage also plays an important role. try to utilize maximum credit limit.
Post Thu Jul 15, 2010 12:52 pm
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pwsolutions
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quote:
Originally posted by pwscs
quote:
Originally posted by pwsolutions
secured loans and mortgage are more important. because they can hurt your credit score.


exactly. your payment history is 35% of your total credit score. so mortgage and loans are more important.


not only payment history, there are factors too those are 65% of your total credit score. but the payment history got the maximum weight age.
Post Sat Jul 17, 2010 9:30 pm
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