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Mr_Swold definitely better adding to pension fund which if done correctly is tax free any money put to mortgage will just be held as lump sum until you finish paying the mortgage term. The bank or building society is not really interested in the amount they lend you but what they get back in interest which is how they make money they therefore will not offer you anything off for paying back early.
Zebra_Cyclist-
But if you pay off your mortgage five years early surely you aren't paying five years of extra interest?
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I don’t think that’s right.
If you overpay your mortgage it reduces the principal balance and the amount of interest charged.If you choose to invest in your pension instead you are making a bet that equity returns will exceed your mortgage interest rate. The tax saving on a pension is only a deferral as you have to pay income tax when you draw down during retirement.
Mr_Sworld
NickCJ
Hmmm...
The overpaying on mortgages makes me wonder.
Is it better to overpay a mortgage or add extra money to a pension fund? I'm 46 btw.