The journey starts here - don't stop believing

pennywisepoundstupid

Its only twelve months of really cutting back, not long really and to be able to have another child and be debt free would be a wonderful feeling, good luck hun i'm sure you will do it.

Polly_Wolly_Doodle

Kat, usually the overpayment reduces the capital (the debt) and as that reduces then the interest reduces too as there is less debt to charge interest on. I bet that doesn't make sense!

But phone the company and check as some will have early payment limits or penalties, credit cards don't but some loans do. Even if they do you are usually better off getting rid of the debt as we all know.

Great idea to be DF before new baby, everything crossed for you xx

**Kat**_2

Thanks guys. I spoke to Barclays twice (a little while ago) and they said I can overpay without penaties but have to go into the branch to do it. Need to sort the reserve and Nat West overdrafts first so we can concentrate on the loan.

Lemon_Tree

**Kat** wrote: »

Right, just had a play around with spreadsheets on current debt as of today (ish, without miniumum payments etc).

Original DFD (no snowball) May 2014 EEK!
DFD with snowball but no overpayments Dec 2013

I will keep adding any overpayments in and adjust the DFD accordingly as and when I can

Kat that's better than when you started out and any improvement is an improvement. Just think what you could do with overpayments even if it's only a couple of quid a month.

**Kat**_2

Thanks LT - I don't want it for that long which makes me more determined than ever NOT to have it for that long

Lemon_Tree

exactly, i had it in my head that i had to be debt free in 2011. It's going to be March 2012 at the moment but that's only because i've made a decision to 'fill' an 8% savings account before i pay it off my last loan, that and pay extra off the mortgage. But i've chatted this through with my folks, who leant me the money and they're happier with that as anything overpaid on the mortgage could be used as normal payments if the worst happened and i was made redundant. If it was money i was paying interest on then i would be paying it back before then ie December 2011.

Kepp

**Kat** wrote: »

PS that is if I am correct in assuming any overpayments go against the balance rather than interest......

I'm a bit confused with what you mean by that!

If you have interest calculated daily then by reducing the balance the interest charged each month will reduce along with it.

If you have a loan with front loaded interest, the interest is already part of the balance, so you won't save in interest but you will reduce the total faster.

Hope that's what you meant!

**Kat**_2

That's a great plan. When we are DF we want to start overpaying the mortgage as much as we can as well as hopefully having babs number 2

**Kat**_2

Yea it was Bec - the loan was/is front loaded, however, it is my belief (although could be very wrong) as I have already been paying interest front loaded, as I reduce the balance and the term, they will owe me interest payments. I haven't factored that in at all as I don't want to get my hopes up - could be a nice surprise if they do though

Kepp

My loan's daily interest so don't know much about the fromt-loaded one's, that sounds like it could the case though, hope so, that would be excellent news!