Please help! Not sure what to do!

Sepa74

I don't think you're in too bad a position - you're only 4 years down the line... imagine if you were 10 or 15!!

I would suggest seeing a financial advisor. When you think about ways of investing money to accumulate a pot to reduce your mortgage you need to make sure your investments are spread out over a variety of investment classes, that the inherent risks cancel each out to a the extent possible and that the investments are made over an appropriate time span - eg the minimum you should invest in stocks and shares is 5 years, and there is never, ever any guarantee that you won't need to sell out just as the market slumps.

A good investment advisor, whether independent or not, will help you understand how to spread out your investments most appropriately.

Of course you also need to do your own research to 'sanity check' any recommendations, but my experience is that they pull me back to a realistic appraisal where I tend to be too optimistic.

A lot also act as mortgage brokers, so you can ask them the questions you were asking above. I got my mortgage through a financial advisor, and I got a far better mortgage than I would ever have found on my own. I went with the Ethical Investment Co-operative so they also gave me a questionnaire to identify my ethical investment priorities so they could advise on that aspect of investing as well.

I would talk to several different advisers and then decide which one seems to be talking the most sense. If you choose to invest through them, they generally receive commission as their payment... not ideal, but it does make them 'free'.

Jonbvn

amancalledmartin wrote: »

I think lobsta needs help, not a lecture.

I think you ought to get off your high horse before you fall off. I am allowed to express reasonable opinions without being censored by you.

lobsta100

Jonbvn wrote: »

I hate to sound facetious OP, but you were hugely naive by taking out an IO mortgage with no repayment vehicle.

Instead of OPing the mortgage, I would suggest you save in cash-ISA's, which are giving a return higher than 2.5% (generally). You and OH can save GBP5.1k each per tax year.

I agree of course it was naive - we both were not yet working when we got our mortgage in 2007 and really didnt totally understand what we were doing.

Once the fixed bond of £10k matures we have cash to put in ISAs

lobsta100

posted in error - correct post below

lobsta100

OK the latest on our situation....

I called Nationwide and asked if I could start overpaying to reduce some of the capital (as we still owe the full £212,900 loan). The woman said could do unlimited so for now have set up to pay £150/month on top of interest costs. Not entirely sure is affordable but I guess I can always reduce it!

Will this in turn reduce the interest cost assuming the term and rate remain the same and the capital is reducing with my OPs?

My other question is: our only savings left now are £10k in a fixed bond that matures in April. What is the best use of this? Should some be kept as emergency savings? Should it all be used to pay off credit cards and then on more OPs for mortgage? Or is it best to put into ISAs?

I am aware that £10k is not going to make much headway in a £212k debt but I need to do anythng I can to reduce our LTV for the future prospect of selling our flat, since we have no savings really for a deposit yet!

Any advice is still very much appreciated!:D

SmlSave

Welcome to MFW lobsta

Can you post an SOA so we have a gander and see if we can help you save some pennies? The interest rates and balance of your credit cards may be useful too.

The general advice is to have at least 3 months wages in savings for emergancies and if you can keep it in a good interest earning account then so much the better!

I'm of the mind that it's a good idea to part save and part OP, then you're generally prepared for anything but that's just my opinion.

lobsta100

SmlSave wrote: »

Welcome to MFW lobsta

Can you post an SOA so we have a gander and see if we can help you save some pennies? The interest rates and balance of your credit cards may be useful too.

The general advice is to have at least 3 months wages in savings for emergancies and if you can keep it in a good interest earning account then so much the better!

I'm of the mind that it's a good idea to part save and part OP, then you're generally prepared for anything but that's just my opinion.

Hi

I have all my info in my posts in the DFW thread:

https://forums.moneysavingexpert.com/discussion/2978322

Thanks!

lobsta100

lobsta100 wrote: »

OK the latest on our situation....

I called Nationwide and asked if I could start overpaying to reduce some of the capital (as we still owe the full £212,900 loan). The woman said could do unlimited so for now have set up to pay £150/month on top of interest costs. Not entirely sure is affordable but I guess I can always reduce it!

Will this in turn reduce the interest cost assuming the term and rate remain the same and the capital is reducing with my OPs?

My other question is: our only savings left now are £10k in a fixed bond that matures in April. What is the best use of this? Should some be kept as emergency savings? Should it all be used to pay off credit cards and then on more OPs for mortgage? Or is it best to put into ISAs?

I am aware that £10k is not going to make much headway in a £212k debt but I need to do anythng I can to reduce our LTV for the future prospect of selling our flat, since we have no savings really for a deposit yet!

Any advice is still very much appreciated!:D

Hope I am not being cheeky by bumping my above post, but it has swiftly moved to page 4!

Thanks if you can give some advice/ support!

32kickstart

We were in similar position where i gave up work so we went onto interest only payments. We paid the maximum over payments and then squirelled everything we could into ISAs. Although its not off the mortgage - it will be at some stage. You're in a good position with £10k saved, so keep on putting some aside. If you can stay at your place for as long as possible you'll be eating into your 'debt'. We did find that we couldn't get another mortgage last year...they wouldn't even give us the size of mortgage that we have already, so we had to change our plans and put off moving for a few years. Are you desperate to move or do you have a few years grace? Now that you know your situation you will be able to get it under control. Good luck.

SeriouslySeekingtoSave

lobsta100 wrote: »

The biggest issue is this - since we bought at the "top of the market" when lenders were not so careful, we were not advised of the seriousness of not having a "Repayment Vehicle" to pay off the mortgage at the end of the term. Instead, I somehow thought that selling the property was all you needed to happily repay.

God, how is this legal?! (I know it's not ethical). For lending institutions to not advise people correctly.

My concern for you is that, yes rates are low now but they can't stay that way so you need to build up your buffer while you can.