How much can I pay off in 2011...

evi3000

the target is £55000 although we should be able to pay off just above £60000!:j If we keep up overpayments our mortgage should be paid before the Olympics start

I started a previous thread but seem to have lost it and with a new year I though I deserved a shiny new thread where I can keep track of my overpayments.

I've been reading other people's threads and have noticed that saving the second and third messgae is the norm to update overpayments so I'm going to try to do that.

If you didn't see my last thread, basically, we moved to Saudi Arabia in late August for my husband's job. Our house in London has been rented out for 2 years (the duration of our contracts although I'm sure we'll be staying longer). We have 2 young children.

I've just made a lump sum overpayment of £23000 and I'm hoping to pay off at least £2750 each month on top of the normal mortgage payments. I have ISA savings of £15000 and I am tempted to use them as a further overpayment but know this is not the best plan as the savings rate is better than the mortgage rate (BOE+1.89%)

We're very fortunate and have exceptionally low outgoings living here (but even so, it amazes me at times how much we spend). I must try harder this year.

Good luck to all this year.

evi3000

evi3000

saved for overpayment details

evi3000

saved for who knows what!

alex_p

Good luck with your ambitious plan!

PS regarding your ISA issue I was thinking the same thing, however I came to the conclusion that it is not correct and scrapped my ISA to put it into my mortgage.

The reason is that your ISA will be a smaller amount than your mortgage (usually). So if you earn a slightly higher interest on a small amount versus paying slightly lower interest on a larger amount - then it does not add up!

Having said that it's good to have separate savings for a rainy day, since once you make an overpayment you cannot get it back out the bank!

LilacPixie

GL with your plan. FWIW I would keep the ISA if the rate is better than mortgage. You will be better off that way IMO

evi3000

Thanks Alex and lilacpixie.
This is my prob I keep getting different opinions and can't decide what to do so I think I should keep them for the time being and I'll try to decide some time this year.
evi3000

abouttimetoo

Hi Evi3000

Good luck with your plans. I just wanted to pick up on something AlexP says about once you have made an OP you can't get them back; this is not necessarily true and each mortgage provider has different arrangements so you will need to speak to your own provider to ascertain your own terms and conditions as some will give you them all back, some a proportion, some nothing and some will allow you to suspend normal repayments until the Overpayments are used up (if you see what i mean). I just wanted to let you know as this might influence/help your savings situation,
Regards
ATT

originalmiscellany

and good luck with your plans too. Certainly it's now the best time to clear your mortgage with rates so low, and if you can afford it as it appears you can, what a great place to be, in a years time with no mortgage!

I'm envious of you

alex_p

@abouttimetoo - thanks for clarifying that. I didn't know once you make overpayment you could get it back again. I guess it would be a bit of a hassle so best to avoid doing that!

originalmiscellany

what we are doing - putting everything into the offset - which if the worst comes to worst we can dip into it at a later date, but it also means our mortgage payments are getting smaller every month. It's a bit of a drug (a legal high!) this money saving. long may it continue

evi3000

Well, it's been almost 8 months since we arrives in Saudi. The region is in turmoil but life here goes on as always (think major repression!)
As Westeners it has little impact on us and we don't see anything or hear anything. The major inconvenience, as I've stated before, is having to wear an abaya in ridiculous heat. It's been fine over the winter but now that temperatures are hitting 35 it's too warm to be outside an off compound.

Anyhow, back to the important business of overpaying our mortgage. Thanks to the sale of our house in France we made a profit and ploughed into the mortgage (£23000). I haven't been overpaying as much as I could (think holiday back to the UK at xmas - and major overspending), a short trip back in March (again major overspending) and we've booked a 2 week holiay to Orlando staying at Disney for August.

However, I am pleased that we have paid off £27,700 including April's OP. The next couple of months we should be able to pay between £1500 and £2500 per month as well as a large OP of at least £7000 in July and I've decided to close my ISA's as they've now dropped below my mortgage interest rate and being non resident in the UK I am not allowed to open new iSAs (I believe this includes moving old ISAs around) so that's an extra £15,000 or so.

By my calculations we should be at £79000 by September 2011 and hopefully under £70000 by the end of 2011.

Fingers crossed my calculations are correct.

Well done to everyone and all the OPs to date. I'm number 112 on the 2011 MFW.

Good luck to you all.
evi3000