single parent with new £70,000 mort to pay off pdq!

gentlepurr

what a great idea for a new board :T

i'm just going through the throes off seperation from the oh, and am just waiting for my formal offer of £70,000 mortgage to come thro from a+l. its been held up somewhat due to the postal strike in belfast, which is where their mortgage centre is.

anyway, i have had to take the mortgage on on an interest only basis, so worst case scenario the payment is £281 per month. i have a 13yr old son, and earn £18,500 per year, so need to know that worst case, i can still meet the payments. i can overpay as much as i want without penalty, but have worked out that if i overpay by £500 per month, i will have paid off at least £60000 in ten years. thtas assuming no change in interest rate, but also not taking into account the fact that as my overpayments progress, the £281 i am paying for interest only will become part interest/ part repayment of loan.

as i have not started the new mortgage yet, i have drawn up a spreadsheet of ALL my outgoings, to at least give me some direction, and to enable me to look at where i can cut back without too much detriment to the quality of life for myself and my son.

will post back on ideas i have along the way.

xx

gentlepurr

heres my SOA:

mortgage £281
council tax £110
gas £50
elec £34
bt phone £19
water rates £19
dog insurance £21
sky tv £21
broadband £18
building& contents ins £27
tv license £11
car tax £12
car insurance £17
petrol £60
sons school dinner money £35
music lessons £40
sons pocket money £13
holiday savings £125
food/clothes/payg top up £216

grand total £1138.
monthly salary £1213.

£75 per month "spare."

oh to give me £50 per week for son, £50 x 52 = £216 per month.

also can claim expenses for using car for work, at 0.348p per mile, i have always saved this in a seperate bs a/c, and use this to pay for petrol, car tax and insurance, as it builds up over the months. i have brought a picasso deisil, excellent mpg, low tax, low insurance, and as i need a vehicle for work, its a good option. don't have car loan as this will be paid off when new mortgage starts.

so:

left over salary - £75
maintenance for son - £216
car tax - £12 (using money from milage expenses)
car ins - £17 (")
petrol - £60 (""""").

TOTAL TO PLAY WITH - £380.

also have child benefit £66
child tax credit £38
but anticipate using some of child benefit for school trips etc,
child tax credit i always let mount up for christmas, so that evens the flow out.

ball park, still have £380 to play with.

having looked at all my outgoings,i have tended to over rather than under estimate them, and would not be without my broadband. stuck to a years contract, ends in may, so will look for cheaper then.
son enjoys sky tv, and its only family pack, so why not. will go for the sky dodge tho' when i've got straight!
pet insurance important to me, elderly lab with stiff hips, so methinks i will be needing to claim on that.
holidays, £125 per month, and worth every penny, i love to see the world, and also can think of no better, more balanced experiences for my son in his formative years.

so, all help and comments greatfully received.

xx

gentlepurr

btw, i should also add that the interest only mortgage is off the back off the equity in my present property, the market value of which is £280,000. i could sell up and buy a four bed det. for 200,000 - 230,000 here, so could jump for any option over the comming period, but if i stay put, intend to see the back of the £70,000 in 10 years (or less)

peterg1965

Hi gentlepurr

Id say you are ambitious given your figures, but why not. You say that you would like overpay by £500/month but you cannot do that with your current figures. Is your salary likely to rise in the future? And whilst I am no expert on maintenance figures £50 / week seems a very modest amount for your OH to be paying. It may be too late but did you consider a current account mortgage?? Having stacks of equity in your property that kind of package may well have suited you very well.

Anyway ....Good luck.......

gentlepurr

hi peterg,

i would like to overpay £500 per month, but am working on starting at £250 per month as a realistic figure to start with. i am hoping that my overestimated figures for gas and elec will steadily increase the amount of spare cash i have available, but to start off with i want to put this extra cash away each month so that i can cover every eventuality. also thinking that holiday savings are flexible, and there are many bargain hols to be had if you shop around.

also, my son is fast growing up, and will probably be out most evenings as he gets older, so within 12/18 months i could get an evening job a couple of nights a week.

interested to read that you don't think £50 per week is much for maintenance, i thought it was quite fair. old csa calcs show 20% of salary, which is approx what oh will be paying me. also, i'm not a money grabbing b!tch, so if accepting this amount means that oh and i can be civil for the sake of our son, its worth it.

thanks for your wishes, i can't wait to get started. oh is still living here at the mo, as he is waiting on some cash from me (hence the mortgage) so he can complete on his house purchase. he has the fire on full blast, every tv in the house on, and we have blackpool illuminations every night at the mo! not very mse at all, which is how i know i will be able to slash the fuel bills!

with regard to my new mortgage, i was limited on who to go to, as i want to be able to get out at any point, even within six months. my plan B is: if i can sell the house for £280,000 i will do so, and move slightly downmarket with little/no mortgage, so i'm testing the water with a for sale board at the mo.

talk about keeping all your options open!

xx

Thefunkygibbons

Good plan

The two elements that will make it easy are
1. Set up a standing order for the baseline amount that you expect to be comfortable with each month
2. Keep the details of your account handy (perhaps on line banking) so you can over pay even more if the month is going well

gentlepurr

thanks for replying to my post, just as i was posting on your sticky!

i have set up seperate accounts:

1. holiday savings
2. utility bill savings
3. overpayments savings, as my overpayments have to be over £500 for the a&l to adjust the interest.
4. seperate a/c for maintenance to be paid into, so that can hopefully accrue!
finally, my rainy day account, which is an existing pot for emergency funds.

one of the reasons i am so determined to do this is because i know we could have done it before, but oh had expensive tastes, and ridiculed my money saving ways, so its something i have to prove to myself i can do, and i know i can!

xx

Prudent

gentlpurr looking at your posting so reminds me off the early days of trying to pay of my own mortgage.

I started just wanting a pool of money with which to make payments if I couldn't afford to meet any.

I am a single parent too. I had more of a salary than you (though lower mortgage), but no maintenance (ex a very higher earner too!). Once I saw the pool growing I got bitten by the idea of getting rid of the debt of the mortgage, mainly because I had insecure employment and wanted security for my daughter.

You will probably have to cut your outgoings if you want to make serious inroads. Like you I love holidays and initially set myself a holidays budget of £100 per month. This soon changed on getting loads of tips from this site - now I have good holidays for very little. Do keep the pet insurance - I got stung last summer by the false economy of not having any.

I found the following really helpful:
Cooking from scratch using advise from os boards
using coupons as part payment as Tesco
Buying evrything I could from charity shops and car boot sales.
using the freebies and days out boards to give ourselves free and cheap treats so that we didn't feel deprived.

andi2

won't you get more child tax credit as a single parent (should only go off one income)?

& have you applied for the 25% discount on your council tax as a single occupant (children don't count)?

Sorry if you've already thought of this.

gentlepurr

thanks to both of you fot your comments.

pru, you sound like a woman after my own heart. i'm already known as the voucher queen round here as far as tescos/supermarkets/boots go, and i do cook from scratch alot, although i realise that i can do this more, and will be doing so after oh moves out.
charity shops and car boots are again a way of life for me, but one thing i do intend to do is to do more car boots, as i have loads of accumilated stuff to sell on. also local papers in bargain cols, and maybe sell some stuff on ebay, but have had my a/c hacked into there recently, so am a bit apprehensive re ebay at the mo.

andi2, i am hoping i will get more child tax credit, but am unsure, as i think the band we fall into at the mo starts at about £18,000, so have a feeling i will just lose out there. anyway, intend to try for extra once oh moves out.

council tax, i have already assumed a 25% reduction there, and added on 5% for the expected increase in april, so think the figure i have already allocated will be about right.

am so looking forward to the future, having set myself this challenge has really given me a challenge i am eager to get my teeth stuck into.

xx

gentlepurr

hooray:j

just had my formal mortgage offer come through from a+l this morning, postal strike in belfast had held everything up, including the surveyors reports. oh well at least i've got it now.

anyway, that means i can now pay oh up, and he can move on to his new house, and i can begin to sort out the rest of my life - the big part of which is making inroads into the mortgage from the beginning!
its really giving me an adrenaline rush!

(sad i know!)

xx