Looking to be mortgage free in 10 years...

BenJMin

Hello all,
I've bought my first house with OH last year and we have an outstanding mortgage of £100,000.

The mortgage is for 25 years and hadn't thought much at the time about paying it off early however when reading through here it makes so much sense to do it and I can't believe the amount you can save just on interest alone!

At the moment I'd only be able to put a small amount aside each month to use as an overpayment as I have 2 outstanding loans for a motorbike (about £1,500 left - currently £120 a month) and the car (about £5,000 left - currently £180 a month) however the bike will be paid off by the end of the year and I'm hoping to put that money straight towards the overpayment fund.

I currently save £125 a month into an ISA but I'm thinking that I'll use this as the start of the overpayment fund.

Sorry for the ramble and background but it looks like I'll be able to do the following:
£125 a month until the end of the year.
£245 a month from 1st January 2012
Potentially £425 a month from 1st January 2014.

We also have a joint bank account where me and the OH put £400 each in to cover mortgage / bills / insurance etc however there is always £60-70 left over each month so we've discussed this and are going to keep all the money in there until the end of the year as a crisis fund for if anything goes wrong (eg car repairs, boiler etc) and we need access to money quickly, otherwise this will be used as a one-off over-payment to help reduce the mortgage.

With all of this in mind it is HOPED that we can be mortgage free within 10 years before I am 40.

If anyone has any help of suggestions with things they did to save money then I'd love to hear them

Captain_Pie

Hello Benjmin -

Welcome from a fellow motorcyclist. What have you got?

Tip from me after getting fed up of "helmet hair" (the obvious ruts in the hair from the lining of my Shoei) - start wearing your hair short enough that you can cut it yourself using clippers (or get your OH to do it for you).

I have my hair short like this and save a fortune on trips to the barbers!

CP

BenJMin

Captain_Pie wrote: »

Welcome from a fellow motorcyclist. What have you got?

I've got a 51 plate Honda CBR 600 FS.
Love it to bits.

BenJMin

Just been looking on the Natwest website and the current mortgage deal we have at the moment is 5.39%.
As of 1st March 2012 it goes down to 4% so fingers crossed that should mean more money to put into overpayment fund. No idea how much as I'm crap with percentages and mortgages but every bit helps.
Didn't realise how addictive this could get!

Captain_Pie

BenJMin wrote: »

Just been looking on the Natwest website and the current mortgage deal we have at the moment is 5.39%.
As of 1st March 2012 it goes down to 4% so fingers crossed that should mean more money to put into overpayment fund. No idea how much as I'm crap with percentages and mortgages but every bit helps.
Didn't realise how addictive this could get!

Does this mean you are locked in with your current deal until March 2012 and that you'll go back to SVR then?

You might want to lock into a new deal then or get a better SVR mortgage from elsewhere. 4% and 5.39% seem a little high to me!

If you think it's addictive now, just wait until you have a spreadsheet tracking it all :rotfl:

BenJMin

I think it was high because we had a high LTV value when we took out the initial mortgage of just under 90% and that was the best mortgage that was on offer.

dimbo61

every penny you overpay now is saving you 5.39% TAX FREE and you are not going to get that from any savings account but please build up an emergency fund of 3/6 months of income in cash ISA,s just in case.

We have reduced our mortgage by £80K in just over 5 1/2 years