Balancing overpayments, savings and home improvements...

Jesthar

Dithering_Dad wrote: »

Hi Jesthar, welcome to MFW!
Thank you!

Dithering_Dad wrote: »

I'd check the terms and conditions of your mortgage regarding the borrowing back of overpayments. Some mortgage lenders charge a fee and also lend the overpayment back to you at their current mortgage rates, not at your original fixed rate. If this is the case, then it might be worth increasing your emergency money and looking at insurance policies as it will be cheaper than having to buy back your overpayments if you hit a financial pot-hole.

It's a Nationwide 5 year fixed, and I believe all they do is recalculate the interest accordingly. I can also use any overpayment reserve to offset underpayments should the need arise, also without charge I think. Will have to have a hunt for the Ts&Cs. Insurance I have.

Dithering_Dad wrote: »

If I were in your position with shared ownership, rather than looking to overpay my part of the mortgage, I'd be saving up in ISAs and other high interest accounts with the intention of increasing my share of the ownership, especially while house prices are falling.

If you spend the next (say) 8 years paying off your half of the house (via the mortgage), when the time comes to start buying out the local council, house prices will have recovered (and indeed we could be in another boom) and it will cost you much more to buy.

To be honest, I'm not sure it's worth it at the moment. My rent with the council is under £45 a month and went up by a grand total of 59p this year (yes, really! ); my basic montly mortgage payment is about 12 times that!

Dithering_Dad wrote: »

The ideal would be if you could buy out the council in blocks of say 5%, rather than having to buy them out completely. Well worth contacting your council and seeing if this is possible.

I already know this one - asked before I bought. It's 10% blocks for my council, so I'd need getting on for about 20k a pop (paid £104k for my share, £90k mortgage is thanks to savings and help from mum ). That's more than my net salary...

Dithering_Dad wrote: »

Good luck with whatever you plan to do, because anything is better than spending 25 years (or more) paying interest to the bank!

Thank you, and it is indeed!

~Jes

Jesthar

Hello, all, update time!

The best news first - my loft boarding is nearly finished! I have a aluminium ladder rather than the wooden one originally planned (space related decision, I think), and it seems so much BIGGER with proper boards and a decent strip light in, even with the monster water tank parked in the middle of it. And I know this sounds silly, but just the ability to finally move ALL my boxes and less used junk out of the way, not just part, is SUCH a good feeling, especially as I can now shin up into the loft whenever I want, rather than have to haul the stepladder in. And fresh, good insulation has been laid below the boards, including areas the original builders couldn't be bothered to do with their cheap stuff, so that should help keep the house warmer, too.

There's still a bit more to do up there, plus the TV aerial confusion is going to be sorted out at the same time (there seems to be a mixture of aerials, cables and Sky dish up there, and we're not 100% sure what cables go where at the minute!) with the aim of getting me better freeview reception.

Unfortunately I don't have my curtain poles yet, but that is mainly due to the chap who is making it coming down with flu and being stuck in bed for a couple of weeks, poor man! Once that is finally here and up, it's curtain time!

All in all, I'm pretty pleased with how this year has gone, as the two biggest jobs - double glazing and loft boarding) have been done! As far as next year goes, the only large job I have planned is getting the patio done properly, as the current 'slabs dumped on a layer of sand' affair is getting more uneven and weed infested by the week, not to mention ant infested, and I have no intention of fighting an onging battle on that front. Aside from that, things will largely depend on what jobs crop up with NEED doing, plus how much I manage to save.

Have a good Christmas, everyone!

~Jes

StuartGMC

Jes
Good to hear of your progress, all seems to be going just as planned. Well done. Enjoy the break over Christmas.

EssexHebridean

Wow - nice to see you so focussed - having an exact plan for what you want to do is one of the biggest helps in this area I think - do your dithering at the start and don't waste further time on it later! You're also doing things the right way round IMO - Double glazing first followed by loft insulation helping to keep in what heat the ailing elderly system produces, not a lot of point in fitting a flashy new heating system before you really need to only to see all the heat it produces rushing out of the windows and doors! Friends of ours are doing up a victorian terrace at the moment - they've gone down the line of central heating, new kitchen & bathroom, but the front of the house is still fitted with the old wooden sash windows! :eek: IMO paying out hard-earned to heat the street is a no-go! Sorting out your garden will probably be doable on a budget anyway, and how nice will it be to have a beautiful place to sit on the sunny summer evenings next year, glass of wine and the paper...mmmmm!

Personally I would be cautious about paying extra into the mortgage with the idea of being able to borrow it back later - what if the need to get it is urgent (ie - boiler goes totally kaput in the middle of january leaving you with no water or heating?) and the building society then drag their heels? We're held current accounts with Nationwide for years now - generally they are very good but it's just taken then six months to adequately sort out money taken from our account via an incorrect DD - I'd hate to think how long it might take to sort out claiming back OP's! Of course, one option is that come April 2009 you will be able to completely fil your ISA entitlement from day one, thus maximising the interest payable for the year? Might be worth considering.

Good luck!

Smithills

Hi Jes
I'm on a similar path to you- paid off my old mortgage, then 2 years ago, bought a new house. It's fab, and I love it, but it needs a lot doing to it. I'm keen to pay off the mortgage, as that's how I got rid of my old one in 11 years, but also want to do up my new house, and so have the same dilemma as you.

I think for me at the moment, I need to be really clear on whether my overpayments are doing what I want them to do. I need to be vigilant re my savings interest rates- and make sure I get the balance right between the two. I'm lucky, in that I work in the public sector, so don't have many of the acute worries about redundancy that many others do. So I'm comfy to have a lump sum in a good savings account (bathroom/kitchen/fitted wardrobe fund. Oh, and holidays too!). But I do find the thought of overpaying very seductive. After all, once you've paid off £100 of capital, you never pay interest on it again!!

So, my NY resolution is to overhaul my finances, get to grips with an up-to-date budget and then make some decisions for the year. Unlike many posters on the MFW boards, I tend to go in fits and starts, depending on what else I'm up to, but now I've written it, I MUST make it happen!;) Good Luck in your quest.

Wookey

Smithills wrote: »

Hi Jes
I'm on a similar path to you- paid off my old mortgage, then 2 years ago, bought a new house. It's fab, and I love it, but it needs a lot doing to it. I'm keen to pay off the mortgage, as that's how I got rid of my old one in 11 years, but also want to do up my new house, and so have the same dilemma as you.

I think for me at the moment, I need to be really clear on whether my overpayments are doing what I want them to do. I need to be vigilant re my savings interest rates- and make sure I get the balance right between the two. I'm lucky, in that I work in the public sector, so don't have many of the acute worries about redundancy that many others do. So I'm comfy to have a lump sum in a good savings account (bathroom/kitchen/fitted wardrobe fund. Oh, and holidays too!). But I do find the thought of overpaying very seductive. After all, once you've paid off £100 of capital, you never pay interest on it again!!

So, my NY resolution is to overhaul my finances, get to grips with an up-to-date budget and then make some decisions for the year. Unlike many posters on the MFW boards, I tend to go in fits and starts, depending on what else I'm up to, but now I've written it, I MUST make it happen!;) Good Luck in your quest.

Get several quotes for any building type work you intend to get done from any/all reputable builders in your area, substantial savings can be made just by doing this. Flooring a roofspace and raising/moving a water tank will not cost you that much, both should be doable for under £700 (its about 2 hours work to raise/move a cold water tank, with about £50-£100 of materials, dependent on distance moved). As for flooring a roofspace, it isn't a living room floor, decent clean second hand timber flooring can be sourced from any number of places, or as a cheap alternative 2'x8' treated chipboard can be bought from a builders supplier for under £6 a sheet, this has the benefit of it being able to be used regardless of joist spacing as it locks in on itself. Make sure your loft is well insulated though before placing any flooring down.

setmefree2

Jesthar

Whoba, but it's been a while since I remembered to update here! So, time for a quick get-things-up-to-date post...

Curtain poles - I have these, but haven't got them up yet - oops! Will get my tame builder to do this soon, and they WILL be up in good time for winter!

Patio - I have saved enough to do this, thankfully, and my builder is in the process of pricing it up! :j

Loft - done, dusted (well, OK, not really - I'm no housework freak! ) and has a whole load of boxes etc. up it. Much better! Shame we couldn't move the water tank, but due to the way it's been built in we'd have had to sawn through roof joists to move it (multi bar trusses, not nice simple A frames, annoyingly), so no chance - when it finally comes out it'll have to be sawn up in situ! Still need to shift some more stuff up there, but the house is a lot less cluttered now. Bill was less than I expected, too.

TV - so most of the Freeview problems turned out to be because the box was sitting on top of my old video, and the static magnets in that were scrambling the signal - oops! Signal is still not great at times, though, so I may still look at getting a better aerial when I can afford it.

Mortgage - still overpaying at the same rate! :j Gotten harder to still have money over at the end of the month (have finally taken out some important insurance I'd been putting off, plus I now have a cat!), but still coping and having enough to save for the patio without having to drop this. Mortgage rate is fixed, so no nice little bonus from the current low interest rates, but not worth looking for another deal as there is still nearly 3 years left to run on it.

One or two general comments too:

I have some reasonable savings to hand, plus a cashback credit card, so emergencies are covered into the few grand territory.

I also have a very good tame builder - and I mean VERY good, both on work quality and price. Jammy, I know - wish more people could be in that position, so I'm sticking with what I trust.

That's about it for now. Starting to think I may have to get the fence done next year (rats...), but if it holds out I won't bother yet...

~Jes

Jesthar

*dusts away the cobwebs from the thread door*

...must remember to come in here more often...

Happy New Year, all! Will head off and subscribe to the 2010 MFW thread in a mo, but first a few updates:

Curtain poles - are up and in use! AND I also have some VERY lovely curtains custom made curtains to hang on the bay window pole (combined two years christmas/birthday present - thanks Mum! ), will post a pic at some point if I can. Just got a basic curtain over the back door, which could do with a thermal lining, but as I picked it up for a few pounds in the Pier closing down sale (miss that shop) and it's a cracking lovely red colour there's no complaints there except from the cat (who moans that it blocks her view of the garden!)

Patio - is done! And my builder both knocked some off the price for taking longer than planned, AND made sure I had the bill before Christmas to avoid the VAT hike - bonus! It looks fab, just need some furniture to go on it now, as the old picnic table has finally disntegrated and has been taken away for use in various wood burning stoves

Loft - heating system is still fine, so nothing changed there. Except it's got a bit fuller!

TV - managed to fix the reception problem, think one of the connectors on the Freeview box is a wee bit temperamental. Still get interference from local sources occasionally, though, so an aerial upgrade is still tempting, and it's far cheaper than getting paid TV

The Fence - took a right battering in the high winds last autumn, and will now definitely need replacing this year. :mad: Barring heating related problems, though, this should be the only major essential job I have to do for a while, and funds should hopefully not be a problem either.

The cupboard at the top of the stairs - is triplewide and huge (aside from containing the hot water tank), but does not have any proper shelving in it as it was used as a spare wardrobe by the previous couple. I've been making do with an old B&Q wooden shelving unit plus the rails they put up, but there's a LOT of wasted space. So I want some proper shelves with room for bigger things currently taking up bedroom/living room space. I also want to replace the cheap and tatty dark stained wooden sliding doors with mirrored sliding doors, as it will increase the light many times and might even work properly

Furniture - could do with some bookcases/storage for the bedroom, if i can find something I like at a reasonable price. More wishlist that absolutely necessary, but would be very useful.

Mortgage - still overpaying at the same rate! :j Had my statement the other day, and I've overpaid over four grand so far (if memory serves)

Think that's about it for now, must remember to update more regularly...

~Jes

SmlSave

Gosh your a busy bee jes! :T I'm very impressed.