Do it now while we are young

everton09

Hi.

Is this a good idea??

At present we have a mortgage of £85000, house is worth £150000 with around 18 years left on it. I live with my wife and dont have any children and due to complications have no intention of having any.

Dont want to sound morbid in anyway and this next line is not meant in the way its written. Im an only child so will inherit a house from my parents in the future worth around 120000 at present.

As we work full time and paid quite well and as we cant have children we are looking to travel extensively. We are thinking to go from a repayment mortage to an interest only mortgage which will save us around 300 per month, thus freeing up a lot of cash to travel the world in the coming years.

I realise that the balance of the mortgage will never go down, but my method of thinking is; If we dont have any children or relatives to leave the house to then why not just pay the interest, technically renting, then in the future pay off the balance with the inheritance. Also we have no intention of moving house in the future.

Our current mortage is 5.49% fixed offest for 10 years with first direct so the facility is there to go interest only.

Does anyone think this is a good idea? are there any drawbacks from this?? We just want to travel when we are young and use the money from our property with out remortaging etc.

Any help will be appreciated

M

koexelek

everton09 wrote: »

Dont want to sound morbid in anyway and this next line is not meant in the way its written. Im an only child so will inherit a house from my parents in the future worth around 120000 at present.

I know exactly what you mean, but a potential inheritance like that can soon dissapear under certain circumstances.
A few years back, my cousin would have stood to have inherited a similar sum, but susequently her mum died, then her dad ( my uncle) got altzeimers and had to move into a very expensive residential care home.
The property had to be sold to fund this, and now there is virtually nothing left.

The owner of the care home is probably lazing on a beach in the Bahamas, while he has illeigal immigrants running the home on the minimum wage........but that's another story

Robert_Sterling_3

I agree with the above post.
We do not know what the future holds.
Divorce, separation, death, injury, adoption, illness etc.

rinkydinkpanther

I would never want to rely on a possible inheritance.

I understand your desire to travel, but it takes time as well as money and getting both together is tricky. Until your house is paid for, you are tied into spending most of your time earning enough money to pay the mortgage.

My husband and I don't have kids and earn good money too. 18 months ago we had an 85k mortgage as well. We have been overpaying like mad, we now owe 40k and will hopefully be mortgage free in another 18 months, before we turn 40.

Then we'll be free. Free to work less, free to travel, and with the freedom of never having to make another mortgage payment again, or to earn thousands more to pay for the interest. Will only need to work to earn as much as we need to pay for the bills and what we want to do. When we're too old to work, we can sell the house and live off that, and hopefully die at a ripe old age neither owing or leaving a penny behind...

Forever_Red

everton09 wrote: »

Dont want to sound morbid in anyway and this next line is not meant in the way its written. Im an only child so will inherit a house from my parents in the future worth around 120000 at present.

I have seen it where one parent dies, the other later remarries then passes away, which leaves the house owned by your step-parent. They subsequently die leaving the house to their kids/relatives and not you.

I personally wouldn't rely on inheritance.

You never know, in the future, if you both wanted children you might adopt and might regret going interest only and not paying your mortgage off.

Good luck with your decision

Alan

uzubairu

rinkydinkpanther wrote: »

I would never want to rely on a possible inheritance.

I understand your desire to travel, but it takes time as well as money and getting both together is tricky. Until your house is paid for, you are tied into spending most of your time earning enough money to pay the mortgage.

My husband and I don't have kids and earn good money too. 18 months ago we had an 85k mortgage as well. We have been overpaying like mad, we now owe 40k and will hopefully be mortgage free in another 18 months, before we turn 40.

Then we'll be free. Free to work less, free to travel, and with the freedom of never having to make another mortgage payment again, or to earn thousands more to pay for the interest. Will only need to work to earn as much as we need to pay for the bills and what we want to do. When we're too old to work, we can sell the house and live off that, and hopefully die at a ripe old age neither owing or leaving a penny behind...

We're in a similar situation.
Reasonable income with no kids (late 30s).

Can't wait to be mortgage free and then we can have a lot more freedom in what we choose to do.

Don't factor the inheritance into your future plans.
If you have good incomes why not overpay and see if you can be mortgage free a lot sooner than the 18 years remaining.

Your thoughts about parenthood may change in the futre and you may want to adopt.
Having little or no mortgage would be highly beneficial in that situation.

hearts

I've not even read your post just the Title.

My advice do EVERYTHING while your young ;-)