The Lemon Fool

We are currently on a 2.59% mortgage and have £80k of cash savings ready to build an extension which we plan to start after we have remortgaged next June (we don't need to borrow more). I have been mulling temporarily using £17k of the extension fund to pay-off part of the existing mortgage (maximum lump sum allowed) and get a notional 2.59% return on the savings for a few months, but then we would have to remortgage it out again. Is it a better idea to forget this plan and instead go into the remortgaging with our existing loan amount?

Thanks.

My take is that as mortgage rates are starting to rise you will have to pay a bit more to re-mortgage thus losing any benefit gained on the interest over a few months.

You'd make about £36.70 per month gross but if you left it on instant access you'd get say £17 per month so you have to weigh up the risk for a net £20-ish per month.

For three months you'd make £60, is it worth it?

That's a good analysis and great answer. Thank you!