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Hello,
I pay Csa rules (pre2003) - shared residence and pay regular etc
My present payments were based on income, number of nights and also took account of all mortgage payments (I did not like giving such information etc)
Can anybody tell me (minefield) if the Csa are any longer entitled to request information regarding my mortgage payments?
I want to know because it would help enormously if I could lower my mortgage without the fear of Csa payments increasing
Many thanks
I'm afraid I don't know the Pre 2003 rules, but certainly post 2003, you were legally bound to inform them of any changes. To be honest, the CSA are not behaving particularly well as of late (if they ever did) so if you give them any opportunity, they could jump on you for increased maintenance, and you may get stung for arrears.
So, the question is, how were you intending to reduce your mortgage? I assume you were either intending to overpay the monthly payments or to pay in a lump sum.
Before I continue, I would stress, I am not qualified in any way to give financial advice - the following is something that I think is correct but should definitely be checked out with a financial adviser before acting on it
As an alternative to paying down your mortgage, look at paying into a pension scheme with a retirement age at the date you intended your mortgage to be paid off (may have to be minimum age 55, but not sure of that) - you will get tax relief on your payments - including a lump sum payment - and the returns on pensions have been higher than the current mortgage rates, so you are effectively borrowing money (your mortgage) and re-investing it at a higher interest rate than you are paying, plus when the pension matures, you can take 25% as a tax free lump sum, and the recent budget changes mean that the rest is taxed at 20%.
Another benefit is that assuming the pre 2003 rules on pensions are the same as post 2003, the pension payments you make will reduce your maintenance liability.
There is the risk that the pension fund won't perform so well (perhaps it might be adviseable to wait until after the Scottish Referendum!!) but the tax relief, 25% tax free lump sum and possible reduction in maintenance means it really has to do very badly to be worse off (and even in the recession, my pension fund continued to rise at a healthy rate).
Hope this helps - but as I stressed, you need to get professional financial advice - would be very interested to hear back from you if you do go down this route.
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