**Deefa's** MFW Diary 5 year plan...

deefadog

Hi all, so i guess it time for another diary for all to see

I guess a quick background on my Mortgage:

Moved house in September 2006 for our growing family, moved from a Bungalow to a Town House LoL - Massive change, took us months to get used to stairs :rotfl:

Anyway for the first year it was a bit of a spam house, but we have eventually made it a home. I'd rather have empty rooms we can't afford to furnish than no spare rooms at all!

As we bought our first home in 1999 - we were on the cheap ladder and we had a cracking part exchange deal on the current house, so left us with a 123k mortgage on a 240k house.

As a very active matched bet'er, by 2007 i had really exhausted most avenues, but made around 20k, so this was chopped off the mortgage, and i kept the payments the same, so have been overpaying around £107 since then

We are with Northern Rock and are fixed in, until July 2011 on 5.19% - Exit fees are around 5k up to the finish date, so not worth moving.

Also i was left some money, which we decided to invest in some oversea properties and these will be ready Next March, which we hope to sell ASAP and have around 55k to take off the mortgage.


So since i noticed the The Mortgage Free in Three - Take 2 challenge thread and i read so much from the last challenge, i thought it's something i would like to join!

So as it stands i have £95800.57 left - 39.92% LTV.

Even though i am in the Mortgage Free in Three - Take 2 challenge, i think 5 years will be my goal, and try for the 3!

I hope this thread will keep my motivated and i can get some help on the way! :beer:

deefadog

**Week 1** (better start ASAP)

Was going out tonight, but it's been cancelled, so i am adding £40 to my pot :beer:

What i need to know is, should i pay little amounts like this off ASAP as i can transfer it with inline banking as much as i want or save it and do it once a month?

Thoughts?

FunnyRabbit

Wishing you lots of luck on your MFW journey, and well done on the first saving

FunnyRabbit

If it were me I would transfer it straight away if you can, as otherwise I would spend it. I suppose it all depends how much self-control you have?

deefadog

Thanks, i have the self control (I think), but wondering if it's cheaper - saving interest by doing it straight away.

financialbliss

deefadog wrote: »

Thanks, i have the self control (I think), but wondering if it's cheaper - saving interest by doing it straight away.

deefadog - done a link back to this thread from the MFiT-T2 thread.

I've not tried an example calculation, but the earlier in the month you overpay, the less interest you will pay for the remainder of the month.

I (currently) have an automated over payment to come out on the 1st of each month alongside the standard mortgage payment. This is an anticipated maximum amount I can afford to put aside to the mortgage each month. Should I have any further spare cash in a give month, I'd also overpay that, but most months it's just the standard payment plus one overpayment on the 1st.

My mortgage rate is 4.79% so generally better to overpay than save and overpay later as some with lower mortgage rates are doing.

FB.
PS - I'm assuming daily interest, as I think most are these days...

deefadog

Thanks (have linked the other thread to this one in my sig also)!

Yes it's daily interest, i am sure but will check with Northern Rock. - If that is the case then paying it when i can will help a bit then saving it and paying a one off. :T

I think i'll pay £40.57p tonight - as that 57p is really annoying me! Is that normal? :rotfl:

dexter_fan

Good Luck on your Quest Deefa.

Ooooh yes its so normal (in the MFW world anyway) to want to round off balances to the whole pound, fiver, whatever. Its one of the many things that become addictive

deefadog

Cheers dexter, much appreciated! Good luck on your too! Now please don't take this the wrong way, but when people like yourself is doing the same goal but has a higher balance than myself it makes me feel even better that my goal is achievable - in the nicest sense of course - i don't have the best way with words sometimes, so don't want to offend!

Good luck

chirpchirp

Good luck with target!

deefadog

Ok, another lesson learned, apparently (and i'll confirm tomorrow with Northern Rock) that if my overpayments are under £500 then they will not count towards money i can borrow back. Now as with offsets and isa's where the interest is more than the mortgage interest you have a pot that if needed can use and i wanted this but via money i can borrow back. So looks like i may have to save up my extra overpayments in chunks!