Five years for Spigs to be Mortgage Free!

mpgsheep

Totally agree with Sunnyday, whilst the extra interest would be nice, when you leaving house at 0700 and not getting in til 1930, time for opening accounts and moving money is really scarce, esp when gains are not ridiculous. Plus seeing the mortgage come down (slowly!) is great to see. That said seeing a pile of money grow too is nice!

Spiggle

Thanks Sunnyday and mpgsheep,

I really appreciate your thoughts on my conundrum. :A

And I am really pleased the £50k for mortgage has been breached! :j

I actually turned the computer off as soon as I'd posted last night and ended up having a long (if strange) conversation with my OH about it. Thing is his eyes glaze over whenever I start talking about interst rates and doing this versus doing that etc. I mean it's really nice that he trusts me to just get on and do the best thing for us but sometimes I need to talk things through.

Anyway, the upshot was that he thinks (and so do I to an extent) that we aren't really the same people we used to be and we have learned our lessons on managing money. There's no way we're going back to spending willy nilly at the shops each day, we have an annual budget, we have piggy bank accounts established for specific expenditures and I have all the bank cards!

I ended up ringing FD back again last night because I thought I'd seen somewhere on their website that the reg saver could only be in one name. I asked them how that would work on a joint account and they informed me that I could have 2 separate reg savers one in my name and one in the OH. Now that's a fantastic rate when you can be putting up to £600 per month away at 8%.

Plus, if I reduce the payment one month, say from £300 to £200, I can at any time during the remainder of the one year term top it back up. So effectively provided the monthly payment never goes below £25 per month (or logically I presume the total above the number of months it's been open x £300) there's always the option to kep it at the maximum saving balance. All of this is extremely attractive I have to say.

I found the calculator I was looking at last night and effectively I would need to find a cash ISA paying 6.4% to just match the reg saver rate on FD.

A lot of people on the MFW 2011 and other threads seem to offset savings so I think I may well go for it.

Anyhow, these thoughts are not yet set in stone so any further advice, thoughts or opinions would still be appreciated.

I'm off tomorrow and will have a good look then at everything and see how we go then.

Thanks again for reading and take care,
Spigs

Sunnyday

Hi Spigs :wave:

i`ve just had a nosy of the FD website and i must say i`m a bit :eek:

Thats a fantastic rate - i had no idea that there was anything like this available at the moment.

All i can say is if you want it go for it.

I`m hoping that the same deal will still be available when i`ve paid off my mortgage. If it is then i shall definitely be opening an account Thanks for the info :A

SD

Spiggle

Sunnyday wrote: »

...i`ve just had a nosy of the FD website and i must say i`m a bit :eek:
...

Yep Sunnyday, it really does make you go :eek: :rotfl:

I've just done the application and I've had an email from them saying the paperwork is in the post for the current account.:T

I feel that all of this is a journey really. It began with me defeating my addiction to buying toiletries (still haven't bought shampoo since last Feb) now well and truly beaten. :j Continued with me defeating our (OH really but I let him do it) ridiculous spending habits for the home, food and booze which I still religiously watch. Was given a firm foundation with setting an annual budget for everything and setting up piggy banking. The map is the plan for over payments and being mortgage free by the time I'm 55.

Within all of the above, now we have some discipline in our financial lives, I want to ensure that we are making the most of every penny we have so that the mortgage is paid off at the earliest possible date.

I've noticed a lot of people are saving their money each month - either through choice or limitations on OP or they have an offset product - but still count in the MFW 2011 thread for instance. Being far more awake today, I believe we really do have the discipline to do this. (Fingers crossed !!!!)

I hope the offer is around for you too.

Take care,
Spigs

Spiggle

Hello, :hello:

I just thought I'd give a little update on where I am with the FD account etc. If you at any time thought the high rating for customer service from FD was hype then think again. I really am very impressed with them so far. :T

So, my current account is now open and fully functioning online. It seems quite easy to navigate too even though I'm used to the A&L/satander one. They were very quick coming back to me with the list of DDs and SOs and a quick 'phone call sorted out which were to be transferred and which were not. The salary transfer form was downloaded from their website and has been given to my employer to become effective after March 1st (I get paid last working day of the month). The selected payments will be switched in the middle of the month (they give you a specific date).

Now all I have to do is twiddle my thumbs (must learn more patience! ) while my final salary payment goes into the satander account and normal OPs go out on the 1st March.

I've had a reassessment of our inc & exp and will still be able to make very small OPs every month to be included with the basic payment (by SO). But the big change is going to be setting up the two reg savers both of which will be called mortgage offset accounts each recieving £300 per month. So when I update every month I should still be able to quite clearly identify what is against capital etc and keep a running balance. I will also be including these amounts in my declarations on the MFW 2011 thread.

The other thing is the FD current account can run a monthly sweep (I'm sure other banks must do it but I'm new to it ) of any excess credit balance into the savings account. Depending on how quickly this builds up, I will be making occasional OPs of this amount too. :cool:

So all in all I'm very pleased. I think a very rough calculation means that we'll be earning the equivalent of £20+ from the reg savers whilst the small OPs straight to mortgage will continue reducing the capital (albeit by much smaller amounts) and more than covering interest charged (at current rates). Plus the extra amounts already paid will have reduced the interest charged considerably.

So there you go. A long update for which I apologise. I have to get these things down in writing to ensure I stay focussed!

I'll be back next week with the totals after OPs if not before.

Take care all,
Spigs

originalmiscellany

Good on you Sprigs. I've been with FD only for a few months (Sept 2010 maybe) but think they're just brilliant and can't fault their service.

Keep your eye on the prize, and look forward to the next FD sweep of your accounts and hopefully that'll top your savings up a bit more

Ciao

Spiggle

Hi All,

Update for March. On Tuesday the standard payment and OP went out of the account by SO. According to my spreadsheet this is roughly where we stand:

Total payment made = £839 of which:
Total mortgage OP made = £424
Total mortgage capital pay down made = £800
Approximate mortgage outstanding = £48,567

CC payment made = £230
Total CC outstanding = £1,610
Therefore, total outstanding debt = £50,177

Right, I have been tempted by the evils of tarting again. The B*rcl*yc*rd offer of 18 months @ 0% was just too much to resist I'm afraid. Had confirmation today that they have accepted my application.

Ok, so here's my logic (faulty?). In line with my feeling of being much more disciplined with money management now I feel I need to make my money 'work' for me at the best possible rates. (I am not yet brave enough to stooze though!) The balance on the existing card is now only £1610 which over 18 months amounts to a payment of just under £95 per month (with BT fee included). That means I have an extra £135 in my monthly income that can be allocated to either OPs or offset savings while giving me a little more flexibility IFYSWIM.

The extra cost of doing this equates to £2.60 per month if allocating the BT fee across the term. It should also ensure that we can always put the full £600 into the reg saver (2x£300 for each of us) each month as offset payment thus earning the best rate. The BT fee is more than offset by the £20 per month interest earned across the 12 month period leaving a net gain of £17.40 per month.

I hope that makes sense. I'm going to spend a bit more time on the budget over the next week or so (in a bill payment/salary lull at the moment) to calculate what will be paid each month to the mortgages once the reg saver is set up.

Any thoughts or comments gratefully recieved as always.

All the best,
Spigs

Spiggle

Hello peeps,

Well a whole month gone and a few things got set up and sorted out. The reg savers got opened last month on 8th March with the full £300 in each. So I had extra to count on OP in the end last month. Therefore, the March total between capital paydown and offset was £1400.

For April I've had to reduce the OP made on top of the standard payment but the reg saver went out today as planned so my figures for April look like this:

Total payment to Mortgage Co. £500
Of which, total OP was £83
Of which, total capital paydown is £467.73 (exactly as I checked with mortgage co. today and paying £25.25 and £7.12 interest respectively on the mortgages now)
Combined with offset savings of £600
Gives a total of £1067.73 off the mortgage this month.

Gotta go, be back later I hope,
Spigs

Spiggle

Hi all,

I just wanted to get a few more figures and thoughts down here.

I'm a bit confused you see. When I checked with the bank last week the actual outstanding totals given me were:

Mort 1 42548.03
Mort 2 5728.88
Total £48276.91

Thus the total is £60 more than I had worked out and I was allowing for more interest/less capital than the reality. Oh I don't know!

I think I'll use the actual totals given to me as the base from which to deduct Mortgage Offset Savings (MOS) and future payments from May onwards.

So, as I stand today, the mortgage is:

Total £48276.91 minus
MOS £ 1200.00

Effective outstanding mortgage balance £47016.91

Right the tarted CC. After adding on the BT fee the Balance stood at:

£1656.80 less payment of
£95
Balance outstanding as of today's date £1561.80

Therefore, total outstanding debt is £48578.71

I think that is right. Well it is according to the bank's figures but not according to to my spreadsheet. I just can't see how they are so different. I'll have to investigate when I'm feeling less groggy and post anaesthetic.

Take care all,
Spigs

sarahevie

A lot of your interest rate dilemmas resonated with me.

I'd like to stooze but not sure whether the gains are worth the risk - credit cards scare me a little, gains can be wiped out so quickly with interest.

Currently just overpaying the mortgage - that's hard enough for me:rotfl: