Mortgage

Extra Payment on the Mortgage!

As I mentioned in earlier posts we received €47.635,85 in equity from our previous house sale. This was not real profit since we paid an extra €70.000 off on this mortgage ourselves over the last five years. Regardless, it was still nice when that amount showed up in our bank accounts mid May.

Our new mortgage provider lets us pay off 10% of the original mortgage without penalties and we can also pay off the equity from our house sale without prepayment penalties. We paid off the 10% out of our savings in the last two months. We get paid around the 19th and the 24th every month, so yesterday we transferred the equity of €47.635,85 to the linear mortgage.

This will lower our monthly payment by about €250 per month, so that is a substantial savings! Our mortgage provider also informed us that since we paid off so much with this overpayment, that our mortgage is now in a different risk class and our interest rate is reduced by 0,35% and for the savings mortgage by 0,3%. According to their own terms and conditions, we should’ve been the ones to bring that up and back it up with an appraisal, but apparently that wasn’t necessary. It’s not all rainbows and sunshine, because the decrease in mortgage interest for the savings mortgage means that we have to up the savings portion of that mortgage. That payment will increase by €12 per month, but the total savings per month are around €60 as far as I can calculate so it’s a net positive. I’ll share the exact numbers when I get the new statement later next month.

We’re now done overpaying on the mortgage for this year and we’ll focus on replenishing some other savings goals that we took some money out of in order to make these extra payments so quickly.

Up next tomorrow is an overview of our August numbers!

 

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