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Youreds's mortgage free journey
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youreds
Posts: 305 Forumite
On Monday I'll drop in to my C & G branch & hand over a cheque for around £39,000, by far the biggest cheque I will have ever written & become mortgage free.
The journey started in Jan 2004 when we moved to a bigger house. We already had a £23k endowment mortgage from 1988, & £25k sat in savings, crazy when I think back, but we got it in pre internet days & remortgaging was only just becoming a big thing around '04.
So, old house sold for £84,500, new house £155,000, no capital was repaid on the endowment (that's another story) so that needed clearing, meaning a new mortgage of £90k with £25k offset, Standard Life being the mortgage provider on a good deal from my IFA.
From the outset we were determined to clear the mortgage as fast as possible, we were both working full time so plenty of disposable income.
Over the next year or so I did quite well at work so my salary got quite better, but it never entered my head to squander any of it, so the offset pot built up to around £35k.
In Jan '05 we had a nipper on the way so the 2nd income would be going. My decent-ish earnings meant the OH didn't have to worry about returning to work when Youreds jr arrived in Sep' 05. This meant a bit of belt tightening, we became a 1 car household & I started using public transport to get to work. The Nottingham Tram was on my doorstep, so it only cost me around £30 a month for the travelcard, saving a fortune in petrol, tax, insurance & maintenance.
With the OH deciding not to return to work, which I fully supported, we got an advantage over the taxman - she was a non tax payer.
The Standard Life Mortgage was switched to a Halifax Deal in '06, mortage was £85k on a 20 year term.
All the savings then went into various accounts with tax free interest thanks to the OH's status, accounts were meticulously ditched & switched, thankfully we weren't in Icesave, but had a close shave with Kaupthing Edge.
In '08 I was fortunate to be promoted at work bagging a decents rise, but again no living beyond means, every spare bit of cash going into tax free savings & still on public transport for me, & Sun £9.50 holidays.
Somewhere during that period we got some compensation for the missold endowment in '88 of around £2k. We still pay the £29 premium on this & it pays out in April '13, won't be anywhere near the £23k though.
Moving on to April '09 the Halifax mortgage was switched to a C & G tracker at 1.08 above base for £80k over 20 years, with the deal ending August 1 2011, I was determined that this would be my last mortgage.
We then had more fortune, the interest rate dropped to 0.5%, but all the savings were locked in fixed rate accounts, some over 6%, this was a huge advantage & somewhere during this period the monthly interest being earned was more than that being charged on the outstanding mortgage.
By my projections we would break even in Jan '10 which duly happened, but due to the penalty clause on the mortgage deal I had to wait until now to repay it.
Not all plain sailing mind, I was made redundant in March '10 & my earnings are now nowhere near what they were, but I got a good pay off & the work had alrady been done.
There was another unexpected bonus of a council tax rebanding which I didn't even ask for! £1500 in the bank. Quite bizarre as I'd followed Martin's guide & concluded it wasn't worth bothering.
That's about it, I was fortunate at some points but I still would have gone at it the same if I hadn't had the periods of good pay.
So that's it, it can be done, hope my story was of interest.
The journey started in Jan 2004 when we moved to a bigger house. We already had a £23k endowment mortgage from 1988, & £25k sat in savings, crazy when I think back, but we got it in pre internet days & remortgaging was only just becoming a big thing around '04.
So, old house sold for £84,500, new house £155,000, no capital was repaid on the endowment (that's another story) so that needed clearing, meaning a new mortgage of £90k with £25k offset, Standard Life being the mortgage provider on a good deal from my IFA.
From the outset we were determined to clear the mortgage as fast as possible, we were both working full time so plenty of disposable income.
Over the next year or so I did quite well at work so my salary got quite better, but it never entered my head to squander any of it, so the offset pot built up to around £35k.
In Jan '05 we had a nipper on the way so the 2nd income would be going. My decent-ish earnings meant the OH didn't have to worry about returning to work when Youreds jr arrived in Sep' 05. This meant a bit of belt tightening, we became a 1 car household & I started using public transport to get to work. The Nottingham Tram was on my doorstep, so it only cost me around £30 a month for the travelcard, saving a fortune in petrol, tax, insurance & maintenance.
With the OH deciding not to return to work, which I fully supported, we got an advantage over the taxman - she was a non tax payer.
The Standard Life Mortgage was switched to a Halifax Deal in '06, mortage was £85k on a 20 year term.
All the savings then went into various accounts with tax free interest thanks to the OH's status, accounts were meticulously ditched & switched, thankfully we weren't in Icesave, but had a close shave with Kaupthing Edge.
In '08 I was fortunate to be promoted at work bagging a decents rise, but again no living beyond means, every spare bit of cash going into tax free savings & still on public transport for me, & Sun £9.50 holidays.
Somewhere during that period we got some compensation for the missold endowment in '88 of around £2k. We still pay the £29 premium on this & it pays out in April '13, won't be anywhere near the £23k though.
Moving on to April '09 the Halifax mortgage was switched to a C & G tracker at 1.08 above base for £80k over 20 years, with the deal ending August 1 2011, I was determined that this would be my last mortgage.
We then had more fortune, the interest rate dropped to 0.5%, but all the savings were locked in fixed rate accounts, some over 6%, this was a huge advantage & somewhere during this period the monthly interest being earned was more than that being charged on the outstanding mortgage.
By my projections we would break even in Jan '10 which duly happened, but due to the penalty clause on the mortgage deal I had to wait until now to repay it.
Not all plain sailing mind, I was made redundant in March '10 & my earnings are now nowhere near what they were, but I got a good pay off & the work had alrady been done.
There was another unexpected bonus of a council tax rebanding which I didn't even ask for! £1500 in the bank. Quite bizarre as I'd followed Martin's guide & concluded it wasn't worth bothering.
That's about it, I was fortunate at some points but I still would have gone at it the same if I hadn't had the periods of good pay.
So that's it, it can be done, hope my story was of interest.
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Comments
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Excellent story. The living within your old salary even if it increases is something we have always tried to do to.RosieTiger - Highest £242,000 Feb 2004 :mad:
Lightbulb Dec 2008 £146,000 by March 2026:eek:
MFi3T2 and T3 No 28 - Dec 2009 Start Balance £117,000
Current Position-Fully off set by savings since March 20130 -
Thanks for sharing your story with us, I enjoyed reading it.Borrowed £150,000 in an offset tracker mortgage in May 2007 - MFD May 2041 (67)
Jan 2012 - £125,620.02 / 2,913.87 / Nov 2032 (58) :beer:
Apr 2012 - £122,901.88 / 3,170.91 / Jul 2032 (58)
Jul 2012 - £122, 589.02 / 3,507.99 / Sept 2032 (58)
Oct 2012 - £120,476.31 / 3,889.42 / July 2032 (58)0 -
Thanks for sharing your story with us, I enjoyed reading it.
Glad you liked it, there were lots more money saving things going on, but I didn't want to make the story too long, Martin & this site were a massive influence. I also forgot to mention that I paid off £29,000 last week that was available before the final batch from Investec, that will have saved about £15 in interest, every little helps
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Well done! We're looking to enter the final year of our mortgage, and cant wait to get to the finish line, to be mortgage free -what a feeling it will be
! Feb 2012 - onwards MF achieved
September 2016 - Back into clearing a mortgage - Was due to be paid off in 32 years in March 2047 -
April 2018 down to 28.00 months vs 30.04 months at normal payment.
Predicted mortgage clearing 03/2047 - now looking at 02/2045
Aims: 1) To pay off mortgage within 20 years - 20370 -
originalmiscellany wrote: »Well done! We're looking to enter the final year of our mortgage, and cant wait to get to the finish line, to be mortgage free -what a feeling it will be!
A shameless bump of my own thread, but why not.
A month or so on & it feels great, got the letter from C&G saying they've removed the charge at the Land Registry, DD cancelled by them & no mortgage payment on Sep 1
It's now a little scary thinking what to do with the spare cash having been so thrifty for so long.
Keep at it folks, you know it makes sense.
Youreds.0 -
What a nice problem to have though :rotfl:
Please tell us you are going to splash out on something now you are MF!
Seriously, well done on getting to the end, its not an easy lifsestyle choice to make and most people don't understand if you try to explain what you are doing. Best of luck for the future.:beer:MFW 67 - Finally mortgage free! 💙😁0 -
You need to put this on the MF Role of honour thread if you haven't done already :-). It's a great inspiration, whenever I feel the need to dream 'i'll be there one day...'Mini Challenge - Halve 2nd Mortgage by Year EndStarting: £10,000 Currently £8,142.62£3,142.62 to go!0
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A shameless bump of my own thread, but why not.
A month or so on & it feels great, got the letter from C&G saying they've removed the charge at the Land Registry, DD cancelled by them & no mortgage payment on Sep 1
It's now a little scary thinking what to do with the spare cash having been so thrifty for so long.
Keep at it folks, you know it makes sense.
Youreds.
But a really nice scary !!!RosieTiger - Highest £242,000 Feb 2004 :mad:
Lightbulb Dec 2008 £146,000 by March 2026:eek:
MFi3T2 and T3 No 28 - Dec 2009 Start Balance £117,000
Current Position-Fully off set by savings since March 20130 -
Hi Youreds
Well done, and thanks for sharing your story - very inspirational.MFi3T2 #98 - Mortgage Free 15/12/20110 -
What a nice problem to have though :rotfl:
Please tell us you are going to splash out on something now you are MF!
Not for a while, having paid off the mortgage I've got just £1600 to my name.
In another fortunate twist though, I've got my job back at the place I was made redundant from.
First purchase will be a diesel car (to save on fuel costs), not new, & not on tick, then a 50" telly.
Perhaps a week in Tenerife at half term, who knows...
Thanks for the comments & good luck.0
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