Need help to work out MFW date

sweetdaisy

I started my MFW journey in November 2011. Mortgage is due to end in February 2026 (in 165 months!), but I would really like to be Mortgage Free at least 4 years earlier.

I am not very good with spreadsheets and have a very simple Monthly Ingoing and Outgoings Excel spreadsheet which I use. I have taken a look at some spreasdsheets i.e. locoblades but it's just too complicated for me.

We have an Offset Mortgage with an interest rate of 4%. We have one current account and three savings accounts linked to our mortgage and interest is added once a month to the balance.

I have tried to create a simple spreadsheet to work out when I can become mortgage free - but just can't get my head around it .

Current mortgage balance is: £80,695.72 and roughly £225 a month is added as interest. I have tried dividing the balance by the number of months remaining (165) and I get = £489.06.

If I set up a spreadsheet using:
Current Balance - 489.06 + any monthly overpayments made = End Balance . . . . will this give me a rough estimation on when I will be able to be Mortgage Free?

Sorry if this doesn't make any sense, I am not good with spreadsheets and I just can't seem to figure out how I can work out when I will be mortgage free!

financialbliss

Hi sweetdaisy,

Currently doing car insurance, but spotted your thread. I've a spreadsheet linked from post #1 in my diary - see posts 534 and536:
http://forums.moneysavingexpert.com/showthread.php?t=572849

I'll try and have a closer look once I'm done with my car insurance!

Financial Bliss.

sweetdaisy

financialbliss wrote: »

Hi sweetdaisy,

Currently doing car insurance, but spotted your thread. I've a spreadsheet linked from post #1 in my diary - see posts 534 and536:
http://forums.moneysavingexpert.com/showthread.php?t=572849

I'll try and have a closer look once I'm done with my car insurance!

Financial Bliss.

Thanks Financial Bliss. I have had a look at your spreadsheet, however I inputted in mortgage details from last month, but it doesn't quite work out.

I think this is because I have an Offset Mortgage and because the current account balance changes almost everyday - as all outgoings are deducted from there - this affects the daily interest paid.

sweetdaisy

Hi Financial Bliss

Just wanted to pop back to say Thank You :j.

I have had another look at your spreadsheet and will tweak it as I go along. The 'interest' figures using the spreadsheet currently work out at around £30 a month more expensive, but obvioulsy this doesn't consider what is being offset against the mortgage, to bring down the monthly interest.

So, once the interest has been added on the 23rd of each month, I will change the 'End Balance' accordingly.

By using your spreadsheet and continuing with our minimum monthly overpayment amount (which is managable as I rounded up the mortgage payment) - we are set to repay our mortgage 2 years earlier than orginial end date :T.

sweetdaisy

Thanks ihalliwell . I have had a look at the site, but it's not for me. I have an offset mortgage, so this type of calculator is not right for me. I prefer to have my own excel spreadsheet that I can use along with my monthly ingoings/outgoings.

Sepa74

Hi SD, I'm like you and have an offset mortgage, so it is really challenging calculating when I will pay off my mortgage.

The amount in the offset accounts goes up and down like a yo yo as I get a large portion of my income paid through dividends, and then I 'pay' the dividends to myself over a period of months.

I get my statement once a quarter (unfortunately no online mortgage statements) and calculate my end date based upon what is in the offset, what is earmarked for other things and what is earmarked as 'OPs'. Because my income is insecure, I never assume that I can save x per month into the offset as there is no guarantee that I will be able to do that over the life of the mortgage.

However, the system has worked well for me, as you can see from my sig. It also means my calculation as to when I will be mf is very conservative, which also makes me happy - I'm looking at the worst case scenario, so any improvement in the dates is really motivating.

sweetdaisy

Sepa74 wrote: »

Hi SD, I'm like you and have an offset mortgage, so it is really challenging calculating when I will pay off my mortgage.

The amount in the offset accounts goes up and down like a yo yo as I get a large portion of my income paid through dividends, and then I 'pay' the dividends to myself over a period of months.

I get my statement once a quarter (unfortunately no online mortgage statements) and calculate my end date based upon what is in the offset, what is earmarked for other things and what is earmarked as 'OPs'. Because my income is insecure, I never assume that I can save x per month into the offset as there is no guarantee that I will be able to do that over the life of the mortgage.

However, the system has worked well for me, as you can see from my sig. It also means my calculation as to when I will be mf is very conservative, which also makes me happy - I'm looking at the worst case scenario, so any improvement in the dates is really motivating.

Hi Sepa74

The amount in my offsets goes up and down too, as the Direct Debit account's daily balance is constantly changing, because I make all purchases using a Cashback Credit Card and transfer amounts spent from the 'Spending' account into the 'Direct Debit' account, so that it is offseting for as long as possible before the full balance is paid at the beginning of the month.

Based on my last Quarterly mortgage statement from Natwest, I am due to repay mortgage 1 year and 6 months earlier, however this doesn't take into consideration what's in the offset accounts - only based on overpayments made.

Having used Financial Bliss's spreadsheet I am due to pay mortgage around 2 years earlier. So I am between figures at the moment! But I know that my spreadsheet's interest figures are over what they should be as it doesn't consider offset balances, so I know that with adding the correct end balance (based from mortgage figure online) at the end of the month, I know I will be able to reduce the term further .

My monthly mortgage payment should be £647 but I have rounded it up to £700, so am making an overpayment of £53 a month. I also do surveys etc so with any money recieved from these half goes into savings and the other half is used to overpay.

I know that technically I don't 'need' to make overpayments, but I like seeing the balance go down . Besides, I am able to have any overpayments paid back to my current account, should I need it, so I have a safety net as such.

I 'need' to pay off the mortgage as quickly as I can as I am working full-time and it takes me 45 mins -1 hour (each way) to communte to work each day and I would like to work closer to home to be able to spend more time with the children. The only thing is is that I am on a good wage, however if I were to get a job closer to home I am prepared to take a paycut as my fuel costs would be less and I'd also reduce travelling time.

Sepa74

Are you sure you are only able to repay 1 yr and a few months early? Surely with 80K in the offset it is sooner than that, or is that 80K not earmarked to be paid off the mortgage?

I use this calculator to work out my end date - I take my mortgage balance, and then subtract what is in the offset account that is earmarked for the mortgage to get the loan balance.

http://loan.bizcalcs.com/Calculator.asp?Calc=Simple-Loan-Payoff-Time

I then enter my interest rate and normal payments and it tells me how many years / months to repay. This misses all the other savings that aren't earmarked for the mortgage, and so it doesn't include the reduction in interest because of that money, but like I said, I like to be conservative in my calculations.

sweetdaisy

Sepa74 wrote: »

Are you sure you are only able to repay 1 yr and a few months early? Surely with 80K in the offset it is sooner than that, or is that 80K not earmarked to be paid off the mortgage?

I use this calculator to work out my end date - I take my mortgage balance, and then subtract what is in the offset account that is earmarked for the mortgage to get the loan balance.

http://loan.bizcalcs.com/Calculator.asp?Calc=Simple-Loan-Payoff-Time

I then enter my interest rate and normal payments and it tells me how many years / months to repay. This misses all the other savings that aren't earmarked for the mortgage, and so it doesn't include the reduction in interest because of that money, but like I said, I like to be conservative in my calculations.

Hi Sepa74

Sorry, my mortgage balance is £80,695 and we have £11,000 in savings accouts which is being offset. Haven't included current account balance as this fluctuates.

Based on the Natwest Offset Mortgage calculator, when I put the figures in it says that I can repay the mortgage in 2 years and 6 month! Don't know why there is such a difference between the calculator on their website and the quarterly statements that I get from them?!