Paying off a mortgage early

[keithcresswell]

Maybe I missed it, but have you tried asking the bank for a settlement figure?

[Thai Chi]

Maybe I missed it, but have you tried asking the bank for a settlement figure?

I have mentioned a couple of times that we will attend the bank soon to see what the situation is.

My reason for starting the post was due to my wife's belief that there was no "discount" for early payment.

I am of the opinion that this (in this case anyway) is not correct.

All will be revealed soon ...................

[Ghostnigel]

I don't claim to be a financial expert, but to my way of thinking, the monthly payments you start paying at the very beginning feels like a lot of money. As time passes, the payments are the same, but, let's say after 15 years, they do 'feel' cheaper because you probably earn a lot more than you did 15 years previously.

All i know is I struggled with my mortgage at the beginning, but it became 'pennies' years later...so it felt like i didn't need to relieve myself of the burden, but i did anyway. It becomes a milestone (not millstone) to pay off your mortgage, and be debt free, and the fear of maybe losing your home if you become ill or injured is such relief....rich or poor, its the same feeling.

Does that all make sense? It does in my head, but then, 10 beers make sense to me in MY head!!

[smacko]

do they have interest only home loans and 100% offset accounts in Thailand? eg 1mil loan, 800k in your bank account, so interest is only paid on 200k

if the loan had that feature using it would be an option to retain access to the capital if required

Edited May 31, 2015 by smacko

[maidee]

as long as SHE pays it off and not you

[SheungWan]

At 6.85% interest I would be paying off that mortgage as fast as I possibly could.

The inheritance is 'free money' and would burn a hole in her pocket. A really easy decision.

[Thai Chi]

At 6.85% interest I would be paying off that mortgage as fast as I possibly could.

The inheritance is 'free money' and would burn a hole in her pocket. A really easy decision.

Are you familiar with the word miser?

I am pretty sure it's my wife's middle name.

[Thai Chi]

Update .........

Went to the bank yesterday and asked about discount for early payment.

NO discount with the exception of not paying interest for the month the loan is finalized.

This didn't sound right to me so I fired off an email to head office.

They 'phoned the wife this morning and confirmed that there was NO discount.

No mention of no interest due in the final month.

After hearing this I telephoned a good Thai friend that has payed out 2 home loans early in the last 3 years.

One loan with Bangkok bank, the other with the Government Housing Bank.

She also got no discount on either loan and stated that what was remaining on the monthly receipt was the amount that needed to be paid.

Next step was to calculate the remaining payments X the number of years to see where she stood.

It worked out that if she lets the loan continue she will be paying 1.072.000 Million Baht more than what is owed on it as of today.

As she has more than the payout amount on hand now she has decided to finalize the loan very soon.

I think the interest figure tipped the scales

[Robert24]

great news. As I said it should be a no brainer. As for the discount, I've never heard of a discount given for early repayment. But to be honest, your wife will safe so much on interest by repaying it early, whether you get a discount or not should not matter.

[taxout]

Simply doing a spread-sheet analysis demonstrating how much you'll be ahead of the game if you pay off the mortgage is the wrong approach.

Unless you're exceptionally flush already, money in the bank has a value beyond whatever cash return you're getting on it, because there's great value simply in having cash at hand if and when you need it.

But if you nonetheless like to do spread-sheet analyses, then calculate in the cost of borrowing on short notice a large sum for health or other emergencies, if you don't have that nest egg at hand because you paid off the mortgage..

[Thai Chi]

Simply doing a spread-sheet analysis demonstrating how much you'll be ahead of the game if you pay off the mortgage is the wrong approach.

Unless you're exceptionally flush already, money in the bank has a value beyond whatever cash return you're getting on it, because there's great value simply in having cash at hand if and when you need it.

But if you nonetheless like to do spread-sheet analyses, then calculate in the cost of borrowing on short notice a large sum for health or other emergencies, if you don't have that nest egg at hand because you paid off the mortgage..

Some good points there taxout.

In this case the wife will still have a "nest egg", only smaller, after she pays off the loan.

As a Thai she is obviously entitled to Government hospital medical. She also has her own private cover.

Worse case scenario ....... she has me to fall back on