Any tips for a newbie???

christilee95 · 17 June 2013 at 1:59PM

Hi all, i'm new to MFW forum...never even considered been able to lower/pay it off sooner. but weve just recently had to rearrange our mortgage...our old one has come to end of fixed rate and weve hopefully managed to get a new one.... down from 4.99% to 3.19% just need to sign on dotted line on Friday.

Our house is worth just under £70,000
mortgage outstanding is £56,000
years left...23years

monthly payment at moment is £326, should hopefully reduce to £287 p/m if we get the 3.19%

how did everyone else start? or how did anyone else manage to be mortgage free?

newgirly · 17 June 2013 at 2:55PM

Hi Christilee welcome to the mfw board

Everbody has different ways of overpaying their mortgage , what I'm currently doing is making very small daily op's (the smallest being 10p a day!) as its all we can afford right now as we have taken out a large loan for a loft conversion.

Some people set up a regular direct debit overpayment , some as and when they get extra money. For us over the lasts three years since starting this journey, we have paid off around £30k (before borrowing it all back again

) and most of that was down to cutting back what we spend on almost everything, cooking mainly from scratch , shopping around, getting cash back, doing surveys ( I see you do lots already) and being careful.

The biggest and best tip of all though is to come on here regularly and read others diaries for inspiration, everyone is so kind and helpful they really make it fun, best of luck

jedi82 · 17 June 2013 at 4:01PM

Hi Christielee, we have simply increased our DD by rounding it up, so instead of 1177 a month, we now pay 1200. Only a little extra that we don't miss as it comes out on the 1st but it will shave 13 months off the mortgage. I am also making tiny OPs (literally pence) each day and these will hopefully make a difference.

Have you thought about keeping your current monthly payment going (ie 326pm) and then you would be OPing by £39 each month anyway and you wouldn't necessarily miss it because that is what you already pay iyswim?

Good luck and read these diaries, they give you soooo many ideas and inspiration.

Jedi x

originalmiscellany · 17 June 2013 at 5:45PM

I would say the best thing to do is to get a mortgage calculator and see how a small amount of overpaying now (say paying £400 a month) will speed up the time you owe a mortgage massively. It's very much a case of short term pain for long term gain.

Other things - post a SOA to list what you currently spend so that other people can comment if you can save e.g. on broadband/phone providers etc.

Getting your partner (if you hve one) on board is great too, and every time you save, e.g. buy one get one free meal out from the coupons here, put the money aside and overpay. When you work out how much your mortgage is going down/your repayments it inspires you more.

Finally, look into your mortgage and you will notice that you spend the first few years paying almost nothing but the interest off your mortgage off. Overpaying eats into your capital which is a very good thing.

Hope it helps?

ixia · 17 June 2013 at 8:00PM

Hi just wanted to welcome you to the boards

I am new to this so I am still pcking up the tips too.

I made my first OP a couple of weeks ago, it was for £500 but it knocked 2 months off my mortgage term I was very happy with that. However I can only pay up to 10% off my balance per year. it is worth checking how yours works as you dont want to have to pay any penalties.

Good Luck!!

Rebob · 19 June 2013 at 10:32PM

I am a fan of the rounding up method. Upped payments by £13 a month and knocked months off. I also asked if there were any new products/deals that I could have. The free ones actually made my monthly paymenst less than the fee pay ones! Moving from SVR to a fixed rate knocked a bit off hence the rounding up. Now paying £500 as and when I can afford until I hit my 10% I am allowed to overpay without penalty.

black_taxi_2 · 24 June 2013 at 1:30PM

56k is near the mark I started,but I'm single no family

I was the bankers friend,taking 1k to 5k loans every year,never reducing capital or debt,now I'm only 16 months away from being in a very good place MF

I started 2009, thinking clear 3 years,was on a decent income.but there's UNKNOWNS out there,loss of fulltime/pt work,health,price of fuel,i lost my job owner died(took me a month)I lost a friday with new owner but gained longterm security with new shift.

with lower wage I adjusted my budget,I found I need my yearly holiday,but instead of 2 weeks it's 1 week.

main thing is NOT taking on new NEW DEBT stop your overpayment for a couple months if need be,if a mini crisis happens,car breakdown,boiler fails.

look at financial balance end of year,if your total debt capital hasn't gone up great,if it's gone down fantastic.

many things happen on your journey which you can't control,but making a decision to become MF earlier means one day that will happen,where I am now I could only dream about 2009.

all the best

ps if you have down days,months,post on here,always someone to give you advice an encouragement to keep at it.

Any tips for a newbie???

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