Would you pay off your mortgage, if you could?

swizzle_2

Been watching BBC`s 2 `Pay off your mortgage in 2 years` how badley they are all doing- anyway it has got me and my hubbie thinking.

Also chating with others about the pro`s and con`s of it.

With have an offset mortgage with savings linked to it.

Had a look at the egg mortgage calculator, and think if we overpay for the next 3 years we might just be able to do it, but it means not doing anything else to the house or buying any new furniture,decorating or carpets etc. Which we could do with, but won`t die if we do without.

We have already increased our income and reduced our expense with help from this site. Not planning on getting second jobs or buying a proprty overseas, just pay more and spend less.

Is a mortgage debt such a big thing? we do not have a large mortgage by todays standards.

What do you think?

Plus if we pay it off and then want to move and get a new mortgage-will we get on-being in our mid 40`s?

Barney088

Why do you ask?

I agree that having no mortgage is a great thing to strive for but there is a life to be had out there too. My sister runs everything to a tight budget, they know what they will be having for supper in three weeks because the budget is so strict. If her husband ever bought flowers she's go nuts at the expense.

Why do you want to clear the debt so quickly?

I would love to have no mortgage at all and I'd spend more time and money on the kids while they are growing up but I don;t think they've missed much because a chunk of our monthly income goes on a mortgage.

Only you will know the answer to your question but if you like the target and if you treat it as a hobby then what harm can it do?

It would be a great dinner party conversation, but if you save too much and take it to the extreme, you won't have any money for a dinner party, or friends if you offer them chick pea on pitta bread as a main course. (one of my sisters month end tricks, yuk)

Bernard_Coleslaw

If you're even thinking about moving in the near-to-middle future (and taking out a another mortgage to fund this) why crucify yourself to clear this one, if it's manageable?

Ian_W

Being mortgage free is great. But, generally speaking, mortgages being secured against property have the lowest interest rates and so are the cheapest form of debt. It follows IMO that your priority should be to pay off any other debts [provided there's no early repayment penalty] first.

I wouldn't, as the Yanks say "break your b*lls to pay it off" - like other posters have said, there are plenty of things in life to enjoy but if you can pay it off without too much pain you've not only zero debt but the interest you were paying the lender can be saved or spent as you choose.

Don't understand your point about moving. You'll be the same age whether you've a mortgage or not :doh: [though you may feel a bit younger without one! :dance: ] - the difference will be you'll need to borrow less to fund your new purchase. :j

Bol whatever you decide.

angelatgraceland

I'd go for it personaly. Do a calculation of your present mortgage payments for the next X years and see just how much you would save at todays rate. I just do not believe in paying interest when there is no real need to. If it's only doing without the things you have mentioned, it's no great hardship. What is your gut feeling on this? Follow it!

shelly

Hubby and I saved hard for 2 years and had the cash to pay off our mortgage. Then he fell in love with a car. It was one or the other. We decided to have the car as we could still afford the mortgage easily and if we paid the mortgage but had the car aswell we would need a loan but none of them were as affordable as the mortgage repayments. If we got into difficulty though the car would go tomorrow and we would have had loads of fun in it. I think it would be nice to say you're mortgage free but not as fun as having your dream car IYKWIM.

kenshaz

Saving money is fun ,beating the system is exciting,escaping debt is uplifting,just do not talk about it to your friends,except the ones on this site.

mistythyme

Dont forget though once your mortgage is paid off you will then have to pay the bank/solicitor for holding your title deeds -worth checking out the costs.

Ian_W

mistythyme wrote: Dont forget though once your mortgage is paid off you will then have to pay the bank/solicitor for holding your title deeds -worth checking out the costs.

Common misconception - but INCORRECT!

Deeds are now stored electronically by the land registry for all registered property - all being registered as transactions like sales & remortgages take place with a 2012 target for all property to be registered. Paper deeds are now of historical value only for registered property and if you've just paid off your mortgage they will be registered.

Banks/BS's/Solicitors still offer to store them for a cost - but as the record at the Land Registry is the all important one, why pay? Our's are stored at home with a copy at a relatives for easier access in case of any dispute. However, anyone can get a copy for £2 from the LR website.

savedup

I agree with some of the other posters, that it is not worth doing if you have other , more expensive, debts etc. and it's certainly not worth working yourself into the the ground for (in spite of a certain BBC series currently being shown ! )

If you can afford to pay it down quicker, or off all together - great - but I would advise you to ensure that you still keep some savings in reserve - in case of emergencies etc.

Having said all that however, I paid my mortgage off last year ( 15 Yrs early ), and believe me it's a brilliant feeling!

The peace of mind it brings is worth every penny.

nearlyrich

We planned to pay the mortgage off on this house to coincide with my DH taking early retirement, in reality we achieved it a couple of years early, it was originally £60k over 10 years and we did it in 8. We started off on quite high interest rates ( it was 1992) and we saved the difference as the rate came down, paid off whatever lump sums we could without penalty and so we actually benefitted from paying in the money (sometimes they only recalculate interest once a year).

What we didn't do was stop living, we had some great holidays and I had decent cars, (dh had a company car at the time)we didn't stop going out etc and my children didn't feel hard done to, they had decent clothes and other stuff that teens require to keep their street cred.

Now we feel really secure in a house that is easily worth 3 to 4 times what we paid and if I lost my income we can manage on DH's pension without losing the house, or we can downsize and still have some equity.

When we kept remortgaging for a better rate our relatives and friends said they couldn't be bothered to do all the legwork involved ( one phone call to London & County was not really a big effort believe me) as they could manage their mortgage payments easily.

Now they are not so sure when they realise why we can afford to fly off to New Zealand for 3 weeks in spite of having 2 children in uni with fees and top ups to loans to provide for.

I would encourage anyone in a position to overpay the mortgage to do it and get that lovely feeling of security ASAP, but don't forget to live because no-one knows what is around the corner.

Edited to add:

We left £25 outstanding on our last mortgage, HBOS hold our deeds FOC, we don't pay interest on the £25, we can drawdown upto 90% of the value of the house without too many checks and HBOS get to substantiate their claim that they are the UK's largest mortgage lender....win/win;)