The Mortgage Free in Three - Take 2 challenge (MFiT-T2)

weezl74

p.s I am catching up with the thread thus far and realised lots of you have posted some more helpful background about your mortgage payment schedule and strategies to be MFI3, so I thought I'd add that.

Mortgage currently with Halifax, 5 year fixed til feb 2011 at 4.99%. Allowed to make 10% overpayment per year.

This hasn't been enough, so I initially overpaid more and sacrificed 2% overpayment penalty on the excess. But then I realised that the Halifax will change the term of my mortgage at any point with a month's notice for free! Which is my way of achieving the same thing with no penalty :j:j:j

So my mortgage payments were £860 per month, and are currently £2075 per month (short term while I use up savings).

Another strategy I've found helpful is to realise the savings I can make on other bills by reducing the mortgage, and then using that money to pay it off faster. Example: My husband and I were paying £75 per month to cover our mortgage on a life and critical illness policy. The policy assumed we would pay off over 25 years, so to ring them every 6 months and ask to have our premium dropped in line with our overpayments has reduced our monthly bills by £50 now, which can be reinvested in the mortgage IYSWIM?

To motivate us, we have this pinned up, with each brick representing £1000, and so we can see what we're shifting!:




Thank you for your PM FB

gallygirl

Ooooohhhh, are we sharing house piccies - here's mine

uzubairu

weezl74 wrote: »

To motivate us, we have this pinned up, with each brick representing £1000, and so we can see what we're shifting!:

I recently took a photo of our house and had it made into 2 jigsaw puzzles.
One with over 300 pieces which gets added to each month and a 15 piece (4" x 6") magnetic puzzle that goes on the fridge door.

The puzzle on the fridge door will be getting another piece added to it at the end of the year. :j

Well done on the progress so far. :beer:

macgirl

weezl74 wrote: »

My husband and I were paying £75 per month to cover our mortgage on a life and critical illness policy. The policy assumed we would pay off over 25 years, so to ring them every 6 months and ask to have our premium dropped in line with our overpayments has reduced our monthly bills by £50 now, which can be reinvested in the mortgage IYSWIM?

That's a really good idea Weezl - thanks for sharing that top tip :T
Good Luck with it, sounds like you'll do it in the 3 years! Looking forward to starting this challenge!

FunnyRabbit

Gosh, Its less than a month now until the challeneg officially begins, have not been on for a while as we have been having problems with our internet line (everytime it rains water gets in our cable box outside and it goes wrong, they send out an engineer and apparently they fix the problem only for it to do it all again)

Its great to see everyone so motivated

Aless

Hello

I have been a lurker for a while and after much thought I have decided to post on the forum and join the challenge. I am a little nervous about posting as my worry is once you admit to an aim, life throws something up to ruin your plans but I have now bitten the bullet - be nice to me!

My objective is to reduce our mortgage from what should be about £225,000, by the start of the challenge, to £150,000 over the course of the challenge. We do not overpay the mortgage so the reduction will be by means of contributing to the offset account - we are too risk adverse to let the bank actually have our cash!

This looks like it is going to be a long post so my apologies in advance but I thought I would try and set out some relevant background.

Our mortgage term is just under 18 years at a rate of 4.99% fixed for just under 5 years. We pay back capital and interest. Two and half a years ago the mortgage was £332,000. When we remortgaged we kept the term at 18 years rather than reduce it but pay the amount we would have been paying if we had shorten the term into the offset every month. Given the size of our mortgage our repayments are relatively high and we did not want to over commit ourselves if something unexpected were to happy income wise.

If our circumstances stayed the same we should be able to meet the challenge as we currently make significant overpayments (into the offset) but it is likely our circumstances will change quite a bit so I can imagine looking back after 3 years being very far from the target. Also I know my husband will be keen on getting a nice new car during the next 3 years which will wipe out a chunk of the offset savings.

As a little personal background, I am married to a lovely man (who is expensive to run) and we have two cats (who are very expensive to run). My husband and I both work full time.

We are not as dedicated moneysavers as many on the forum but we have a balance between spending and overpaying that works for us. The motivators for cutting down our mortgage are many from freedom to despising paying interest to banks.

FB, I will try and put the necessary info in the spreadsheets soon.

Courgette

What a good idea! I've just done this:


Ooops, might be a bit large! :rotfl:We have £30 000 outstanding, so each brick is £100. With such a small amout before each bit of colouring in I hope we'll be super-motivated!

My real house is far prettier, by the way! :rotfl::o

ETA: flaming thing didn't go in, grr. You get the idea though

taxi73

I know what you mean about things getting in the way as I've just had to have a new boiler installed.
Looking forward to the challenge.

Aless

Ouch taxi73. That is exactly the sort of thing I mean. Most people can't do without a boiler and they are so expensive, it wipes out a few overpayments.

weezl74

uzubairu wrote: »

I recently took a photo of our house and had it made into 2 jigsaw puzzles.
One with over 300 pieces which gets added to each month and a 15 piece (4" x 6") magnetic puzzle that goes on the fridge door.

The puzzle on the fridge door will be getting another piece added to it at the end of the year. :j

Well done on the progress so far. :beer:

uzubairu, wow, what a creative idea! I want one