Mortgages

Playing the mortgage game

Q. I'm a 28-year-old single woman and I bought a rental property in January 2004 for which I have a $149,500 mortgage.

Tuesday, August 23rd 2005

The mortgage is interest-only, fixed at 7.3 per cent until January 2006. The rent pays for all the annual outgoings.

My plan is to keep renewing a fixed-rate, interest-only mortgage and, at the end of each term, pay a lump sum off the borrowed amount before re-fixing.

This will give me flexibility on how much I can afford to put towards paying it off each term and won't tie me to high principal and interest repayments every fortnight. I can't afford to live in the property on my own which is why I'm renting it out.

I'm leaving my job in September to go travelling and will get a superannuation payout of about $18,000 which I have been contributing to. I have two questions:

* Should I put all the superannuation money on the mortgage when I re-fix it next year or should I put some into another super fund?

* Do you think my plan of paying lump sums instead of principal and interest repayments is a good idea?

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Heartland Bank - Online 6.69
SBS FirstHome Combo 6.74
Wairarapa Building Society 6.95
Unity 6.99
Co-operative Bank - First Home Special 7.04
ICBC 7.05
China Construction Bank 7.09
BNZ - Classic 7.24
ASB Bank 7.24
ANZ Special 7.24
TSB Special 7.24
Unity First Home Buyer special 6.45
Heartland Bank - Online 6.45
China Construction Bank 6.75
TSB Special 6.75
ICBC 6.75
ANZ Special 6.79
ASB Bank 6.79
AIA - Go Home Loans 6.79
Kiwibank Special 6.79
BNZ - Classic 6.79
Unity 6.79
Westpac Special 6.39
China Construction Bank 6.40
ICBC 6.49
SBS Bank Special 6.55
Kiwibank Special 6.55
BNZ - Classic 6.55
Co-operative Bank - Owner Occ 6.55
ASB Bank 6.55
AIA - Go Home Loans 6.55
TSB Special 6.59
Kainga Ora 6.99
SBS FirstHome Combo 6.19
AIA - Back My Build 6.19
ANZ Blueprint to Build 7.39
Credit Union Auckland 7.70
ICBC 7.85
Heartland Bank - Online 7.99
Pepper Money Essential 8.29
Co-operative Bank - Owner Occ 8.40
Co-operative Bank - Standard 8.40
First Credit Union Standard 8.50
Kiwibank 8.50

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