Mortgage Free by November 2028

CountingPenniesClaire

Hey Everyone

It is really encouraging to read how others are progressing with paying off their mortgage, & good to know that there are people out there taking responsibility for their financial decisions too. I find MSE is a great inspiration particularly at times of temptation or despondency (plenty of that about at the moment!), so at the risk of being a mortgage bore I thought I'd share my efforts and plans.

As first time buyers my partner, Andy, and I got our first mortgage (a 7 year 5.69% fixed rate mortgage with Northern Rock) in 2001. We wanted the certainty of a fix but checked the small print to make sure there were no penalties for overpayment. After a couple of years we started making regular overpayments and in the last 18 months have really ramped up the overpayments to the point where we have been overpaying by a whopping 150% each month! So far we've overpaid by £25000 and based on a projection of continued overpayments would be mortgage free by March 2013 (originally 2026), saving £67000!

Our fixed rate with Northern Rock expires in Feb 09 and with 60% equity in the house we've decided to opt for a First Direct offset mortgage which tracks the Bank of England base rate +0.79% for the term of the mortgage. We've seen first hand what overpayments can do to your loan period and interest payable and can't wait to offset our savings but still have them easily accessible for emergencies. There are no redemption penalties, arrangement, booking, legal or valuation fees to pay and all being well we hope to be on target to pay off the mortgage by 2013.

We then plan to do save up a few quid and take sabbaticals or quit our jobs and do some well earned travelling around the world for 3 months.

GOOD LUCK TO EVERYONE ELSE OUT THERE TRYING TO "GET THE MAN OFF THEIR BACK".

Claire

Starting Mortgage: £149,000 Nov 2001 :eek:
Current Mortgage: £99,568 Oct 2008
Mortgage Free Target Date: March 2013

getmore4less

Basics plan look good.

I would put some cash ISAs into the plan as well, the long term benifits of tax free is worth having.

shirlgirl2004

Sounds a great plan. You've started well I hope it carries on as well. :beer:

shopgirl2512

Hey! Sounds like you're on a roll! Well done - keep up the good work...I'll look forward to reading your diary.

EssexHebridean

Hello, welcome, and the very best of luck!

CountingPenniesClaire

Thanks v much for the votes of confidence and to getmoreforless. I'm putting most of my extra money into offsetting the mortaging but I'm making sure I put a little bit of money into a cash mini isa for a rainy day.

Treacle_Toes

Hi,

We've just applied for (and been offered) the very same mortgage as you. I'm actually getting quite excited about it going live in late Jan 09 and seeing what offsetting will do.

With the base rate cut last week we've already saved since our application went in, so we're particularly pleased as our current mortgage provider (we're fixed at the moment too) hasn't dropped their rates yet.

Come next year we're going to be pretty focused on overpayments/offsetting, and I'm already starting to contact my direct debit companies to change the payment from the beginning to the end of the month so our money stays in the account as long as possible.

Good luck

TT xx

Ed_Zep

I think tracker mortgages are a great idea. I got a offset fee-free 0.50%+BOE remortgage with the Newcastle about 18 months ago and it's worked out well. I just hope the base rate continues to fall.

gallygirl

Ed_Zep wrote: »

I think tracker mortgages are a great idea. I got a offset fee-free 0.50%+BOE remortgage with the Newcastle about 18 months ago and it's worked out well. I just hope the base rate continues to fall.

One point to watch for others - make sure tracker is against Bank of England base rate, not the bank or BS's SVR - they're not the quickest at dropping them these days.

Ed Zep that looks a great deal :T

setmefree2

Welcome & good Luck:T:T:T

setmefree2

gallygirl wrote: »

One point to watch for others - make sure tracker is against Bank of England base rate, not the bank or BS's SVR - they're not the quickest at dropping them these days.

Trackers are usually ok if they follow the banks own base rate as well. We have a tracker that follows Barclays base rate and Barclays base rate has always followed the BOE base rate.