nels
Apprentice
Joined: 30 Nov 2005
Posts: 20
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 Posted: 10/05/07 - 01:58 Post subject: |
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I presume that your bank account allows overdraft, since you're thinking about using it. Overdraft is meant to be a short-time borrowing to help consumer to deal with sudden costs. Every overdraft has a limit and if you borrow above it there are usually high interest rates to pay for exceed. If your account doesn't have an overdraft built in you will have to request an authorization for using it. Unauthorized overdrafts are not good because you will have to pay a lot for using them, so check what your bank account allows. If you're thinking about using an overdraft make sure that you can afford it, like you do for every type of borrowing. Overpaying mortgage is not an obligatory payment and you don't have to do it. I understand that you saw some benefits from it but you will have another cost if you take an overdraft for it. You will get an interest rate for using overdraft so calculate if it's worth it. My recommendation is never borrow money if you don't have to. If you insist on overpaying use interest free credit cards. But you will have to pay debt anyway, it would just come later. It's a solution if you expect some money in few months. I've never heard that somebody overpaid mortgage with overdraft.
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