Just how do you do it?

Brallaqueen

I am single, just bought my first flat for £75k (£7.5 k deposit) at an interest rate of 7.25% over 35 years. Looking at it in black and white like that it looks quite frightening and I'm starting to worry that I've bitten off more than I can chew?

On top of that, I have this feeling that I should be making my money "work for me" and making overpayments on my mortgage but today it feels like an impossible task...

Can anyone give me some perspective?

dimbo61

Just raed your post!
Term over 35 years so be aware you will pay very very little off the balance in the first 2/3 years.
10% deposit on a flat so maybe worth little more in 2/3 years time.
7.5% interest rate is high ( is this fixed for 2/3 years ? )
Build up some savings in cash ISA,s first ( the emergency fund 3/6 months of income ) then overpay every penny you can afford to. GOOD LUCK
You are on the property ladder and have a place of your own with a mortgage of £67,500 so be careful how you spend your hard earned cash.
Avoid putting anything on the credit cards IF you cant pay it off that month.

The_White_Horse

your mortgage is tiny. be thankful it isn't 200k plus.

Brallaqueen

Thanks for responding to my post, think I was having a little wobbly moment...This month was the first month I had everything come out 'at once' so to speak and looking at my bank account today was a bit of a shock!

I'll get used to it, and hopefully having a mortgage will help me get a credit card FINALLY. It's like I don't exist on the financial plane

Adem_3

I bought my own place a year ago and I think it's taken me a year to really get to grips with my monthly budget as it seems that I'm always paying out for something e.g car, insurance, etc. so don't get too worried about everything 'coming out at once'. It will settle down and I'm sure you'll be fine.

cha97michelle

My advice for overpaying is if you can only afford to start small, then start small. My lowest overpayment was 39p. It all starts to add up to big things. I am not working at the moment so we are bringing up 2 kids on about 70% of what we were on before kids. I shop around and if i save a pound i send it to the mortgage. Read some of the threads and see if anything inspires you, and don't feel like you have to do absolutely everything at once.

When we first moved in here someone at work asked me if i had already redecorated everywhere as she couldn't bare to move into a house that she hadn't decorated. When i said we couldn't afford to she said she would go and buy whitewash and do that. I have always thought make do till i can afford what i want or it is absolutely essential it is done then.

You do get in the routine very quickly of when things go in and out, and it gets easier.

SimbaSimon

Brallaqueen wrote: »

I am single, just bought my first flat for £75k (£7.5 k deposit) at an interest rate of 7.25% over 35 years. Looking at it in black and white like that it looks quite frightening and I'm starting to worry that I've bitten off more than I can chew?

On top of that, I have this feeling that I should be making my money "work for me" and making overpayments on my mortgage but today it feels like an impossible task...

Can anyone give me some perspective?

I would advise to take things slow and start overpaying when you have some spare money. We brought our house just over 3 years ago. The first 2 years I didn't overpay anything but had lots of other expenses to deal with but set up online banking at the end of the first 2 years. Year 3 I started making overpayments, anything from £2 - £60 a month. Overpayment total for Year 3 was £460, now in Year 4 so hoping to try and top that.

gmang

7.25% is very high at the minute. Do you have credit problems?

getmore4less

Can anyone give me some perspective?

The rate is very high, what was the deal any promotional period?

Whats your income?
Any other debt?

Brallaqueen

Thanks everyone, it helps to talk things out rather than stew in my head.

I know the interest rate is high - as I'm FTB, had 10% deposit and earn less than 20K, this was the best deal for the most money.

I could have gotten a slightly better interest rate but not enough mortgage to be in a nice area around here. The money I lose in interest rate I gain in living in a safe area with low crime rate.

I don't have any debt except student debt - no credit cards, store cards, car or mobile phone contract. My money covers everything, it just feels very overwhelming right now, and I feel like I should be saving, overpaying, investing, improving, redecorating etc all at once!

hostie1985

Hi Brallaqueen,

Do you have an emergency fund? Most people say to have between 3-6 months of your wages in there just incase something happens and you need the money for it.

After that, I would keep money aside for decorating/improving. But if you dont need to then I would put the spare money to pay off the mortgage.

Hostie

xx