A savvy mother has shared her strategy to reduce her mortgage by £1,500 through a clever money-saving tip. Neesha Craig, a 36-year-old residing in Swansea, Wales, along with her spouse and child, managed to obtain £300 by selling her Samsung Galaxy S23 Ultra. She utilized this sum to make an additional payment towards her mortgage.
According to a recent study conducted by musicMagpie involving 2,000 adults, approximately 38% of individuals in the UK have at least one unused smartphone in their possession, which could be valued at an average of £250.
Neesha, who operates the financial platform TheFunMoneyClub, emphasized the significance of considering mortgage overpayments. She highlighted how a small overpayment can significantly impact one’s financial situation. Neesha shared her experience of trading in her old Samsung Galaxy S23 Ultra for £300, which she promptly directed towards her mortgage, resulting in a reduction of two months from her mortgage term and saving her £1,510 in interest.
Mortgage overpayments involve making additional payments beyond the regular monthly installment, aiding in expediting the mortgage repayment process and reducing the overall interest accrued, potentially leading to substantial savings and a shorter mortgage duration.
It’s essential to review your mortgage terms as not all mortgages permit overpayments without incurring fees. For individuals on fixed-rate deals, most lenders typically allow up to 10% extra payment annually. Fees for overpayments usually range between 1% and 5% of the additional amount. Conversely, those on standard variable rate deals generally have more flexibility in terms of overpayment limits.
Before opting to make an overpayment, it is advisable to prioritize clearing any outstanding debts and ensuring the presence of an emergency fund.
In related news, musicMagpie recently announced a partnership with retailer Timpson, enabling customers to trade in their old smartphones at Timpson stores nationwide. AO World, the parent company of Music Magpie since December 2024, described the collaboration as a faster and more convenient approach for individuals looking to trade in their phones.
The service, following a successful four-month trial in over 1,300 Timpson stores, complements the existing offerings ranging from shoe repairs and key cutting to dry cleaning. Customers can hand in their phones at the store for assessment, with funds transferred within minutes, enhancing the overall trading experience.