A mother who is adept at saving money shared her strategy to reduce her mortgage by £1,500. Neesha Craig, residing in Swansea, Wales, with her family, earned £300 by selling her Samsung Galaxy S23 Ultra and utilized that amount to make an extra payment on her mortgage.
An analysis conducted by musicMagpie involving 2,000 individuals revealed that approximately 38% of people in the UK possess at least one unused smartphone stashed away, with an average value of £250.
Neesha, the founder of TheFunMoneyClub, emphasized the benefits of making mortgage overpayments, stating that even a modest additional payment can significantly impact the loan. By trading in her old smartphone and redirecting the £300 to her mortgage provider, Neesha managed to reduce her mortgage term by two months and save £1,510 in interest.
Making an overpayment on your mortgage involves submitting an extra payment on top of your regular monthly installment. This approach aids in accelerating the mortgage repayment process, reducing the overall interest accrued, potentially resulting in substantial savings and a shorter repayment duration.
It is essential to verify with your lender whether your mortgage terms allow for overpayments without incurring penalties. Typically, individuals on fixed-rate deals can make up to 10% extra payments annually without restrictions. Fees for overpayments, if applicable, usually range between 1% and 5% of the excess amount paid. Conversely, those on standard variable rate deals often have the flexibility to overpay any desired amount, but confirmation from the lender is recommended.
Before deciding to make an overpayment, it is crucial to assess if any priority debts need addressing first and if an emergency fund is in place.
In other news, musicMagpie recently collaborated with Timpson, enabling customers to trade in their old smartphones at Timpson stores nationwide. This partnership, facilitated by AO World following its acquisition of Music Magpie in December 2024, offers a more expedited and convenient method for individuals to exchange their phones.
The initiative follows a successful four-month trial period that saw over 1,300 Timpson stores providing the service, complementing their existing range of services from shoe repairs and key cutting to dry cleaning.
Customers can bring their smartphones to a Timpson store for assessment, and funds can be transferred within minutes, streamlining the trade-in process.