Pay Off £200k in 100 months!

SwitchyChick

Ahem. As mentioned in 1st post I am hoping to stooze my way to MFdom!

My current MBNA stooze ends in 4 weeks' time & I have been scrabbling about to find the next card to BT to. So far, all cards have been in my name but I wanted to include OH in the stoozing activity.

Initial signs looked good:

I applied for the Egg Money card (my name) online & had the application accepted last week but no sign of the card yet...

Also applied for Barclaycard OnePulse (OH) which offers 0% BTs for 14mths. Card arrived today with credit limit of £10k, but can only BT £5k at the 0% rate. Bah! If only I had read the forums properly I would have spotted this before applying for it. Oh well, better than a poke in the eye with a sharp stick I s'pose.

Now I still need to find a home for remaining £9k of stoozepot. OH has received CC cheques from Lloyds TSB card but Stoozulator says "NO!" Also have CC cheques for another MBNA card but ditto situation above (3%+ transaction fee + paltry 6mths offer + low C limit = NO!)

May have to follow YorkshireBoy's lead & reduce stoozepot to almost zero then apply for Virgin Money in a few months' time.... Pah!

On lighter note, OH is getting into offsetting/stoozing/overpaying. I was calculating his work expenses y'day & he said "And I suppose you'll be using that to overpay the mortgage too!" Well, now you mention it...

Actually, haven't quite worked out when/how much to overpay but its early days yet.

Switchy

SwitchyChick

Just logged on to internet banking to check whether impending transfers from savings accounts had hit the current a/c - NO - Faster Payments phooey!

Then spotted the mortgage had increased back over the £130k mark. Who'd conveniently forgotten about the £399 arrangement fee? Well, I couldn't have that could I, so another £399 paid off...

dimbo61

Good luck with the MF challenge
Not sure on your maths ! you have added the mortgage and all ! the interest for 100 months or £68,575.50+ £130,000 to get to £200,000
You will pay alot less if you overpay GOOD LUCK

dimbo61

Example £120,000 mortgage over 22 years at 4.74% = £200,000
£120,000 mortgage over 10 years at 4.74%= £150,000
So by overpaying by £500 a month you will save £50,000 in interest and pay off mortgage in 10 years
Simple really !!!
Offset saves even more interest and therefore pays off mortgage even quicker.

Lynn11

Dimbo - it was good to see your example. We have a capital and interest mortgage and it was down last Dec but I have managed to overpay approx £4,000 more than the standing order set up. I try to put in £200-£500 extra per month to bring our mortgage down but unsure how quickly this reduce the amount of years until I receive the yearly statement.

getmore4less

SwitchyChick wrote: »

So, the details are: £130,000 capital, £68,570.50 interest, giving a grand total of £198,969.50/100 months = £1,989.70/month. Why 100 months? Well, it’s a nice round number and roughly translates to our remaining mortgage term. Is it feasible? Hmm...

AS others have said this is wrong £130k over 100 months is much lower

cant see a rate lets say 5% is <£1600pm

less the offseting effects if you can keep up the pot with temp cheaper money.

Watch those BT stoozes, not so easy to make them pay with the fees and min payments going out. Slow stoozes work and are easier to make money with.


Still max out the cash ISAs the tax free lives on past the mortgage and then you won't be able to ISA all the surplus money if you can do over £1500pm.

SwitchyChick

Our official o/s mortgage term is 9yrs & 5mths (2yrs fixed at 5.89% interest-only) and the capital + interest figures are those quoted by our mortgage provider. We have just (31-10-08) started this new offsetting mortgage & it is all new to me. If I have got my figures wrong I hold my hands up, I am a bit of a dunce when it comes to maths
My challenge is to treat is as a repayment mortgage and reduce the term to 100 months - just for the sheer hell of it!
Sorry if I misled anyone

getmore4less

It is not a problem, the Mortgage providers numbers asume no offset pot so is a worse case and still leaves you to find that £200k over the period

A normal repayment schedule gives you the midlle ground based on a regular amount that will pay of the debt and interets in the time you want, this is the most usefull for most people as a target since income is monthly.

Any extra offsetting just makes things better and brings the date forward.

Don't forget to have longer term plans as well, especialy is there are likely to be lump sums from pensions for example, maxing out those ISA can have a long term benifit even if there is still a bit of mortgage debt for a bit longer.

SwitchyChick

Not entirely sure whether these have been conscious or not:
- Using the dishwasher less, i.e. not putting it on every night out of habit but waiting until it is actually full
- Ditto the tumble drier. Even though the weather has been terrible the last few weeks I have either put it out to dry or had it dotted all over the house trying to dry it!
- Nagging everybody to turn off lights, TVs, computers when they're not in use. You'd think they'd be sick of it by now
- Turning down/off all the thermostats in every room except the 1 I'm using (and even then sitting there with layers of clothes on looking like a Michelin man)
- Trying to get DH to get out of the habit of taking out £100s from the ATM and instead just getting the £20-50 he actually needs! For some reason he feels the need to have a full wallet at all times. Is this a guy thing
- Opening all the blinds/curtains really wide when the sun is shining on those rooms. At the opposite end of the scale, leaving the big winter curtains pulled shut in our north-facing living room when I'm out all day. Honestly...

Switchy

dimbo61

Do the MSE big things as well
I saved a lot of money well only £12 a month actually on the life assurance when I took that out BUT when you multiply £12 x 12 months X 22 years it adds up to over £3500 plus I now overpay the mortgage by that amount
The £12 saving was the difference between the quote from my lender for life assurance and the deal I got ( cavendish online )
Also save on gas + elec bills, car insurance, buildings + contents ins ETC
GOOD LUCK