2011 mfw

financialbliss · 2 January 2011 at 12:14AM

Rolls sleeves up…

As I’ve subscribed to this 2011 MFW challenge and I’ve yet to set an objective, I better get one in ASAP, considering I made an overpayment today!

I suspect I’m like many others in that you have a year end mortgage value you would like to attain and plan overpayments accordingly. But, I’m finding 2011 very difficult to plan. I need to factor in:

Dropping off Nationwide 4.79% fixed rate in March
Potential to drop onto Nationwide BMR @ 2.5% from April
Open to BoE base rate increases if I drop onto Nationwide BMR
Save rather than overpay if I can get a good savings rate

So, I’ve been playing around with 3 scenarios where I’ve put myself on the Nationwide Base Mortgage Rate (BMR) and I’ve added two Bank of England (BoE) base rate increases, thus the mortgage ends up at a rate of 3% come the end of 2011.

Scenario A.
Made an overpayment today of £70.67 – this tops my standard mortgage payment to £1,000 per month. If I keep the overpayments up for 12 month, overpayments would be £848.04 and the mortgage would end up at £22,215.

Scenario B.
Continue with repayments of £70.69 from January to March, then up overpayments to £204.42 per month. After 12 months, overpayments would be £2,051.81 and the mortgage would end up at £21,000.

Scenario C.
Continue with repayments of £70.69 from January to March, then up overpayments to £286.99 per month. After 12 months, overpayments would be £2,794.88 and the mortgage would end up at £20,250.

I’d so much like to end up 2011 at a round value of £20,000 but that would probably need an overpayment of something in the region of £314.51. There again, that’s with my expectation of two BoE base rate increases – there could be more and there also could be less, but I am expecting base rate rises in 2011.

Note: I’ve a credit card balance at 0% that expires in March, so I’m keeping the overpayments lower until this is cleared.

So, what am I opting for?

Scenario A is definitely achievable. Scenario B is possible but will be harder to achieve and Scenario C or ending up at £20,000 is a real stretch.

I’m going to be a realist this year and have decided to aim for something that’s a little bit taxing, but not so much so that I get disheartened / loose interest.

Scenario B it is – and I’ve rounded the overpayments to £2,050.

As mentioned earlier, already made an overpayment of £70.67 today, which is 2.53% of my target. Automated overpayments already set up for February and March and I’m aiming to speak to Nationwide soon to discuss where I go with the mortgage.

Financial Bliss.

ironman1 · 2 January 2011 at 9:59AM

Hello Cake, I will join again please. Was going to give it a miss this year because we have a baby due and my gf won't be working from March so we won't have much spare cash. But we can still overpay a bit each month hopefully....

I doub't we'll be able to make a payment every month so can I half last years target to £2000 please. Thanks

black_taxi_2 · 2 January 2011 at 3:44PM

amazing how you work out financial stats FB

pavlovs_dog · 2 January 2011 at 6:34PM

I've waited so long to be able to join this thread, so excited to finally be here :j

I would like to be put down for £1500, which is just over 2 months worth of normal mortgage payments. My diary to document how well i do is HERE. secretly :shhh: I would love to manage £2k, which would cover the mortgage product fees which we regretfully had to add to the mortgage but given that we still need lots of furniture and have things that need doing around the house I fear that may be too ambitious.

We only get an annual statement, but mortgage is currently in region of £132K over 25 years, fixed for 5 years at 4.19%

turbo5019 · 2 January 2011 at 9:33PM

Well made 1st OP £77.29 not much for me been used to paying off at least 1K a month but had to take a loan out of £11k over 3 years but I want that gone by end of year and as the intrest rate is higher I will try and get that gone first. Hoping to make another op at end of month with what every money we have left.

Ansoff · 3 January 2011 at 12:33AM

Hi Cake

Sorry for the delay in responding to PM. Really pleased to be joining made my first OP today of £100.

Ansoff

Giraff · 3 January 2011 at 6:03PM

Hi No 70. OP of £190 today!

Happy new year!

fieldofdreams · 3 January 2011 at 9:45PM

#119

Overpayment of £400 going in overnight.

LilacPixie · 3 January 2011 at 9:51PM

69 here... £490.11 op sent

first of many:D

fluffysox · 3 January 2011 at 11:00PM

Happy New Year and Happy New MFW Challenge!
Thanks to Cake for giving up her time for us again this year:j:j.
Back to work tomorrow... booo!!! So decided I'd better come up with a target for the year. Still don't really know how 2011 will go financially as it depends....

whether OH's contract of employment gets made permanent at the end of 6 months
how long I end up taking for maternity leave
how much it costs us to buy and run a second car
how much the soon to commence work on the house ends up costing
whether interest rates go up- fingers crossed they stay low

All in all, decided to set a goal of £1200 net- that is to OP 1200 more than we draw down from my OP reserve- but honestly if we end up with £0 net OP in 2011 I'll be satisfied. I'll update when I draw money down or OP. I've filled in a googledoc Cake.

Good luck all!

2011 mfw

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