Wot?! 25 years until mortgage free? -- Our dream to reduce our term --

Rose_Crow

Hi everyone! (I've copied this over from a previous post)

I've skulked over here from the savings board as my OH as I received our first annual mortgage statement yesterday. To give you a bit of background information - we bought our first house in July last year. Things are going ok, and when we received our first statement, I was a tad surprised to find that of our £890 / month payments, only £200 odd was going towards the capital. For some reason I didn't think about how the repayments were broken down! £200 a month! We'll never pay that capital off (well, yeah, in 25 years!) So we've started a little target to get that looming 25 year term down as much as possible!

We've talked about trying for £100 extra a month, so if possible can I join with a target of £1200 for 2011. We're with Santander, who seem so only allow you pay overpayments in £500 chunks. So we'll probably put £100 a month away, but still update the spreadsheet monthly (even if we haven't reached £500).

Some more details:

Mortgage amount at start (July 2010): £138,925

Mortgage amount as of January 2011: £137,811

Overpayment target: £1200 in 2011

nickinoo

We're in the same boat, we have paid about £50k into our mortgage over the last 5 years but it's only gone down by £14k :eek:

Rose_Crow

So, day 2 after making the decision to be MF.

Chatted it over in more detail with my OH last night. He was as (pleasantly) surprised as I was to discovered the results of the overpayment calculator. We're definitely going to through as much as possible at this, whilst still having a life and having a reasonable amount in savings for emergencies.

Yesterday I rang Santander to ask about the overpayments, apparently we're entitled to pay off 10% each year, £13700 odd. No chance of getting near that, but for now we have a target of £1200, and see how we go. They have a bizzare procedure where you have to pay the cheque (min £500) into a branch, then ring them to make sure it overpays the mortgage. I also ordered a cheque book for the current account we're going to pay the money out from, so we're all set!

Wish us luck!

Rose_Crow

Just got off the phone to Santander (it had better not be a premium rate number 0845). In the booklet sent out with the annual mortgage statement, it says that the minimum capital repayment (i.e OP) is £500. I was a bit miffed at this, as this means it could take 5 months for us to save this up, in the mean time Santander are creaming off the interest that money could be saving us. I've just spoken to a guy there, and he said that the £500 min payment this is now non-existent - interesting as according to the back of the booklet, the booklet was printed in 10/12/2010. Hmm. Still, I'm going to try taking a measly £50 cheque into the branch now.

never_too_old

grn.w.nv wrote: »

Just got off the phone to Santander (it had better not be a premium rate number 0845). In the booklet sent out with the annual mortgage statement, it says that the minimum capital repayment (i.e OP) is £500. I was a bit miffed at this, as this means it could take 5 months for us to save this up, in the mean time Santander are creaming off the interest that money could be saving us. I've just spoken to a guy there, and he said that the £500 min payment this is now non-existent - interesting as according to the back of the booklet, the booklet was printed in 10/12/2010. Hmm. Still, I'm going to try taking a measly £50 cheque into the branch now.

Hi good luck with the overpaying,with reference to the number its a lo call number these dont normally get included in your free calls, have a look on say no to 0870 , type in the number and see if it brings up a geographical number.:D

Rose_Crow

Thanks for that, will definitely see if I can find an alternate number.

Just got back from Santander, seemed a very smooth process, paid the cheque in, though caught the cashier a little off-guard, I take it they don't get that request very often. A nice chap in the branch said I could use their 'reception' phone to call the mortgage servicing people. Got straight through to them, and sorted it within a couple of minutes. First £50 over-paid!

Should I expect something in writing to confirm this?

Rose_Crow

Hehe! I love that website! Just tried an alternate number and went straight through to someone from mortgage services, which I wasn't expecting. Normally you have to go through that, press 1 process.

christabell

I am with Santander as well, and was always told to pay any extra for my mortgage it was in £500.00 amounts, so now it can be done in £50 amounts? Is this correct?

n90bar

I overpay my Santander mortgage by £200 per month. I just rung them up, quoted the account number and told them to increase the direct debit by £200 per month. Been doing it for 7/8 months now without any problems. Just checked through my mortgage statement that came recently and it all appears in order!

originalmiscellany

It's always a shock the first few years of mortgage payment where you feel like you're making No inroads into paying off the mortgage But you are, and if you're overpaying, £100 a month will make a big difference long term - so well done

Have you considered a SOA
http://www.makesenseofcards.co.uk/soacalc.html

to ensure that you're saving and getting best value in all areas of your life?

originalmiscellany

And well done on posting here - keep a regular posting here to keep you motivated!