Mortgage-Free Wannabe Welcome and Explanation

wronlaster

I like this "it's great to have a place where to track progress and discussed with others who have the same aim"

GloriaAndrewCar

I would love to be mortgage free!

serry

Having a forum like this is a far more realistic approach to the whole concept of aiming to be mortgage free.

echocharlie

Mortgage free date: researching at minute so have no idea but I'm gonna say 4./8/13 mortgage at minute: 121, 918 at the 30/7/13 . Years left 27 years 5 months.
Start of mortgage 127, 000 just need to figure out how this forum works and what to do next heeeeelllp!

Jani9

It's hard for me to get my head around being mortgage free.

As I said in another part of the forum, me and my OH are putting aside £1000 a month so £12000 a year and £120000 in 10 years.

We may move within the 10 years but if not then we could pay the mortgage off and own the house outright.

But our mortgage outgoing per month is only £600 so we will be doing all this saving to be better off going forward by £600 per month.

Am I looking at this right?

argomatt

Jani9,

The effect of your extra payments is much more than that because they reduce the capital, and as the capital is reduced the amount of interest is also reduced.

If you keep your £600 monthly payment as it is, then your mortgage will go down much quicker than you think.

Have a go with the overpayment calculator to check different scenarios and I think you will be surprised how much difference it makes to the speed you will clear the mortgage!

Matt

Jani9

Thanks Matt.

We moved into our house 2 years ago and bought via a 30/70 split mortgage.

So our mortgage is on the 30% and works out at £300 a month and we pay rent on the rest also at £300 a month.

I'm not sure whether to keep things as they are and save until we can pay it all off.

Or maybe we should save for the next 4 years and have £50,000 as deposit plus any equity we may/may not have and get somewhere we will own 100% at the end.

I'm confused!

Yog_sothoth

What about if the mortgage is interest-only and with a company who penalise you if you pay more than the monthly interest set by them, ie. they don't allow you to repay any of the capital, as they class even £10 as 'early repayment'?

Palmanova

I think it would probably be in your best interests to try to get onto a repayment mortgage where you can make repayments when you can. If you have enough money left over after your mortgage payments to put into your mortgage then you should have enough to get out of your interest-only and onto a repayment mortgage.

Otherwise, just save the money up for when you have to pay for the house at the end of all your interest payments.

Palmanova

We currently have a mortgage with 22 years left - £135k (£200k property).
We also have savings of 25k.

In a few years we would like to buy a bigger home and rent out the current one. Should we continue to save for a new deposit or pay off the current mortgage?.

What's evertone's views?.