Almo's MFW effort

Almo

:wave: Hello all!

After months of reading all your diaries, I'm embarking on one all of my own. We're settling on our property on Friday and then the MFW journey can begin.

As background, I am a 25 y/o ESL teacher, and my boyfriend is a 25 y/o Recruitment Consultant. We emigrated to Australia a year ago and have been renting a lovely but tiny one bed apartment in Melbourne, right in the heart of the city. We love city living but wanted to get on the property ladder and the banks here have very strict lending criteria on city apartments and we couldn't even come close to getting an apartment of the size we would want at the moment. One of the goals of this challenge (a long term goal) is to be able to move back into the city.

So, after months of tentative enquiries, followed by visiting numerous suburbs, we stumbled on a lovely 3 bed detached house and after a few weeks of negotiation, our offer was accepted. It's been three months since the offer was accepted and settlement was originally scheduled for next week but we've managed to bring it forward.

Our mortgage is $1790 per month (at an eye-watering 8.92% - standard interest rate in Oz at the moment!) but we should easily be able to overpay this. Our income varies as I'm currently a sessional teacher, but averages out at about $6200. We have a 3 week trip to the UK coming up in November, and some work needs to be done to the house, so those expenses need to be met, but long term we'd like to be overpaying by about $1200 a month. This would allow us to have some instant access savings as well which is crucial for me and my peace of mind - being thousands of miles away from friends and family, if anything terrible should happen back home I want to be able to drop everything and get a ticket rather than wait for the overpayments to be released to us.

I seem to have rambled on an awful lot, sorry! I'm just very excited

Almo

In all the excitement I forgot to give details of the mortgage! We've borrowed $224,000 over 30 years (80% of purchase price) and hope to pay this off in about 8 years. Boyfriend earns decent commission but we don't want to count too heavily on that with the world economy slowing.

setmefree2

Welcome & Good Luck with your Mortgage Free journey:T:T:T

poppyoscar_3

Welcome aboard!:hello:

Looking forward to following your progress!!

PO xx

Almo

Well, our first mortgage payment has just come out - $1790.80, of which all but $8.35 was interest! How frightening! I overpaid this month as well by $181.99 which came from skimming our account down to a whole number. Feel pleased that the first payment was an OP but it does seem like a long road ahead.

We are busy painting in the house, and at the moment there are two men outside ripping down a vile cross between a pergola and a carport that the previous owner had put in. Once that has gone, they'll be removing the faux brick cladding which contains asbestos. That will go ahead tomorrow and all being well we'll come back to see beautifully preserved weatherboards underneath. If they aren't beautifully preserved and we have to replace them that'll put a serious dent in our plans for the renovation. At this stage I should point out that it's not uncommon for houses in Oz to have this cladding, and ours also needs restumping which again is pretty common. Costs a lot though!

In terms of overpayments I'm still letting the dust settle from the move a little. At about the same time as we moved OH changed from being paid weekly to being paid monthly. I'm just looking at moving direct debits etc and waiting to see what the new bills will be. Once I've got back into a routine I'll be able to assess the overpayments - hopefully we'll manage around $750 a month OP and still have enough to get some rainy day savings on the go. I'm also keeping an eye on the fact that I have only 3 weeks left of this term, followed by 2 weeks of unpaid leave (compulsory) for the semester break. We're off to the UK shortly after that which was planned before I took this job. Sigh. All I can see ahead of us is a lot of expense!

Only good news is that our bank has passed on the recent interest rate cut.

setmefree2

Hi Almo:hello:

Getting mortgage free is a long haul - we have been at it for 5 years already - but we'll be here to cheer you on all the way..so......

CONGRATULATIONS on your first OP:T:T:T:T

SmlSave

Good luck with OP's Almo!

evab_2

Welcome to the DFW trail, well done on first overpayment

EssexHebridean

Hey Almo - well done on your progress so far!

Something we've done for our overpayments at the moment is to spend money that we would otherwise not have had - so, changes in our tax codes, pay rise, a saving on our household insurance, all those sorts of things have been added to the monthly payment and we're surprised to find that we're now OP'ing 16% of our payment each month! As you will see from my thread we also have a long term goal, of which paying off the mortgage will be step two...ish! It's amazing how all those little odds and bits add up though, and in the long term it makes such a difference.

Your interest rate is indeed eye-watering....and we think we have it bad over here?!! :rotfl:

gallygirl

Hi Almo, how exciting to have 1st home :j.

Don't think we can let you join our club though as you have an unfair advantage - you can have rainy day savings but we've all spent ours :mad: - can anyone remember a day it hasn't rained in the last month - I've come up with only one :rolleyes:.

Oh what the heck, we're not proud here (I was allowed in ), so WELCOME :hello:and well done on 1st OP.

SmlSave

Hello Almo,

How are things going?