Without more information it is impossible to be too specific about how to use your husband's redundancy money. Only you and your husband can decide the relative importance to you of the improvement to your lifestyle the refurbishments to your property should make compared to the benefit of lower monthly payments that would result from reducing the mortgage.
Before considering making a lump sum repayment of your mortgage you need to check whether there's an early repayment charge (ERC). If your mortgage has reverted to the standard variable rate there probably will not be any ERCs and even if you are still in an ERC period most lenders will allow you to overpay by up to 10% a year or £500 a month without incurring an early repayment charge.
As the refurbishments would only cost about a third of the redundancy money it would be possible to do some or all of the refurbishments, which may increase the value of the property and hence your equity, and also pay something off the mortgage. If you can comfortably meet the mortgage payments you have more flexibility in deciding what to do but if you are struggling you should prioritise repaying the mortgage. You should also bear in mind the increase in monthly payments which will occur when mortgage interest rates rise. One additional point is that it normally makes sense to pay off the most expensive debts first, so if you have credit card or other debts charging a higher rate of interest than the mortgage, you should aim to pay those off before the mortgage.
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