Saving for the Mortgage

Stereochild · 28 December 2014 at 12:55AM

I'm in a very sweet position. :beer:

Friends have bought a house for me using a revolving credit account and have given me the option of buying it off them at the same price that they purchased it at by January 2016. :j
I've been making monthly payments into the credit account and whatever I pay into the account will be used as a deposit towards a mortgage.
Currently it is being rented out and the rent is being used to cover all expenses related to the property and also the interest on the loan.

The house is in New Zealand and so all my monthly payments are at the whim of currency fluctuation's. So sometimes good and sometimes not so good.

The house was purchased for $96,000 and I have been paying £750 a month since February - total of £8,250. Also I paid in a deposit of $20,000 when the purchase was made back in February.
The New Zealand dollar is quite a steady currency and is worth about half of a pound. So I've found it easier to just halve or double to get the correct amount.
So $96,000 becomes £48,000 and £750 becomes $1,500.

My plan is to increase my deposits to £1000 a month from about April/May. And then start applying for a mortgage from about October.

By then I will hopefully be putting down a 50%+ deposit but lots can happen between now and then.

AAaaaaaaaaaaaahhhh I am getting me a 'little slice of heaven!

.

Stereochild · 2 January 2015 at 1:06PM

Goal for 2015 is to pay in £10k towards the mortgage.

Lots of stuff can hamper this but I am going to be counting every penny this year.

I am self employed and my current job is very up in the air at the moment. I don't know for how much longer it is going to last but I will carry on as if all is well. Moving on to a new job isn't something I relish.

My next mortgage deposit payment is planned for the second week of the January. I get paid weekly but will not have the full amount to cover the payment so usually borrow from my Emergency Fund to tide me over till the next pay day and pay it back.

Looming on the horizon are some major maintenance costs, starting with an exterior painting. It really badly needs a paint job.
Yeeppieee I get to choose the colour but I also get to foot the bill.

Stereochild · 15 January 2015 at 12:29AM

Sent off my first deposit payment for the year today but had to increase the amount by £20 to cover the difference in currencies. The pound is weak at present which is not good news when buying currencies.

Work front is still a worry but I would be happy to just get through the month. At least I will have paid my self assessed tax bill that is due in January.

So my goal is to pay £10k - only £9,250 to go!

Stereochild · 23 February 2015 at 5:44PM

My monthly payment has been sent off today to cover my February deposit towards my mortgage savings.

The big worry I have had, has been my employment. Being self employed has lots of down sides as well as up and I have been very fortunate in my last few jobs as they were long term. My current job is going well - well I hope so. It's a new experience for me which is good.

Anyway - got a job, so got an income, so can pay my bills and my saving. And it's a good thing too as the paint job has been completed and the total bill has come to £2,603.10. This brings my total saving balance down to £17,146.90 (this includes my February deposit).

My plan to get a mortgage later this year (around October) may now not be my only choice. The interest on personal loans are at an all time low and I am wondering if it would be cheaper to apply for an unsecured loan and then pay the rest off with my usual monthly payments (around £6,500). This will not be a stretch on my finances as I will have paid off my last loan and will be debt free by March and my monthly out going is very low. Less than a weeks pay in fact.

What to do???

I can apply for the loan and they can only say "No".

Should I???????????????????????????

Stereochild · 16 March 2015 at 12:29PM

Well ........ they didn't say no but they didn't offer me 3.6% interest either. More like 11.6% which would be almost double the interest on a standard mortgage. So it looks like I will be still getting a mortgage.

I have made my March deposit and am only down £500 from my end of 2014 deposit total. This means the house painting costs are almost covered in full. So am very pleased about that. I wonder how much a paint jobs adds to a properties value?

Stereochild · 24 March 2015 at 8:10PM

I have done it again......... I'M DEBT FREEEEEEEEE.........!!!!

Had to get that out again. :beer:

Have been doing the happy dance and dreaming what the increase will do to help my goal of paying off my mortgage super quick. I need to get my Emergency Fund together again and the plan is to save up 3-6 months of income. I felt this would be better than just saving up expenses for the same period, as my expenses are very, very low.

At the same time as this I am also saving up £10k before applying for a mortgage. I would like to have 50% deposit!!!

Stereochild · 20 April 2015 at 9:43AM

Not doing so well with my budget this month as I have only just started putting monies aside for things like birthdays and I have spent everything put aside and worse, I still need pay for postage.
My bank account has an overdraft facility of £250.00 interest free and I don't know if I can get rid it.

Stereochild · 4 May 2015 at 11:06PM

I have now got my Emergency Fund up to £1k again. :j
My next goal is to fully fund my Emergency Fund - I have planned
to save £6700.00 in total, so only £5700 to go.
Am working on a cash only spending plan but it is not easy! I have postage cost this week, so my weekly spending will be reduced again! Last month is was birthday's and I have one more this month too.
I need new clothes!!! I would love a holiday etc. but austerity is the only way to gain my goals and get my dreams.
"Live like no one else - so later I can live and give like no one else"
and to quote some one else - "this too shall past"!

Stereochild · 11 May 2015 at 11:05PM

Called my bank today and cancelled my overdraft - no dramas. So I am very happy with that. My credit rating should now start to head for zero as the overdraft was the last form of credit I had with any bank.
It is quite funny really as I have been approached twice in the last week to apply for a new credit card to help improve my credit rating. I despise these credit card companies and how they rip off those who can least afford it.
The whole credit rating system we have inheritance from the United States is robbing the very poor to make a few (you can add what you like here) very rich.
What is a credit rating and should we be worried about what our credit rating is?
A credit rating is just an overview of the current debt you are managing and how well you are doing at making payments. It doesn't take into account how well you have maintained your debt in the past, only how well you are doing this minute.
I guess in a few months time I will know if I have gotten my credit rating down to zero. By then I should have a good amount of money saved in my Emergency Fund and have built up my mortgage deposit. I will have money to spare but will not be considered a good credit risk. That is how ridiculous the whole system is - you have to stay in debt to get the best deals, even if you can ill afford to pay back the money.
Is it really worth your financial future to stay in debt just to have a "good" credit rating?

Stereochild · 13 May 2015 at 9:28PM

Currently working on saving my full Emergency Fund of £6,700, which I've been doing in two parts.

1. Save £1,200 into my expense account.
2. Save the remaining £5,500.

So I've saved the first £1,200 and now I am working on the second part.
For the best part of the last ten years I had a flexi-loan of £5k which I felt I couldn't live without. It was my security blanket, especially after I got rid of all my credit cards and I was only ever going to use in absolute emergencies.
At the end of last year I finally close the account, it was killing me as I kept on having emergencies!!! You know the emergencies - new pair of shoes, clothes on sale, presents for my god-kids etc. The one thing I did get out of my Flexi-loan account was that £5k made me feel securer.
I need to sit down and work out how long it will take me to save this amount while I am also saving £5k for my house deposit.
The only large bill I have this year will be my tax bill but that is not due till the end of July.

Stereochild · 18 May 2015 at 6:14PM

Last week was a good week in regards to my weekly cash only spending and I even had a little change left over.
My bank account has been in credit all week and that is what I need to build on to have three months of good bank statements for when I apply for a mortgage in August/September of this year.

I have got to get use to having money in my bank accounts and also get used to not spending it!!

Saving for the Mortgage

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