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edited 30 November -1 at 1:00AM in Mortgage-Free Wannabe
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cufc_mikecufc_mike Forumite
587 Posts
edited 30 November -1 at 1:00AM in Mortgage-Free Wannabe
Hi all, newcomer to the board. Well, I say newcomer...I've been registered for a few years, but rarely post. My wife and I got our first house (and Mortgage!) back in 2007 and were doing really well, overpaying by £300 p/m, and subsequently reducing the mortgage by 20 years (from 35); however after various issues occurred, we've ended up moving house, just last month actually. We decided to keep hold of our other house, which is now rented out, but we now have a 2nd mortgage to look forward to repaying every month. At the moment we're no longer overpaying on either mortgage, but with 200k worth of mortgages to pay off, I was determined to actually do something about it otherwise we'll be 60 before they're paid off!

So that's why I'm here, and this is my diary! With the new house, and increased utility bills, we'll struggle to get to a point where we can overpay the same amount as we previously were. My target is overpaying my 2nd Mortgage (higher interest rate) by £240 per month, which will knock 15 years off the term (Mortgage Free by 45!)

So I've signed up to various sites, and will use MSE's expertise to reach my goal! I can't believe some of the stories I've read on here....it's so motivating!

Replies

  • Well in my eyes as a wannabe mortgage free wannabe.. (I have to move first as this house will not see us through) Congrats on getting this far. We also purchased in 2007 Height of the market and new build (bad times) so are now sitting in Neg/ equal equity. Once debt is gone the mortgage will start to too.

    Good Luck on your journey
    On the way to ZERO!!
    Debt @ 1/6/2012: £30,200 :eek:
    Mortgage @ 1/6/2012: £233,000 :eek:
    Debt at £10,000 by 1/6/2013 £28,867/£30,200
    House Fund £2000 by 1/6/2013 £1000/£20,000
    Mortgage: Will tackle that next!
  • greentgreent Forumite
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    Welcome to the board :D
    I am the master of my fate; I am the captain of my soul
    Repaid mtge early (orig 11/25) 01/09 £124616 01/11 £89873 01/13 £52546 01/15 £12133 07/15 £NIL
    Net sales 2021 £209.04/£500 Decluttering 2021: 600/1000
  • cufc_mikecufc_mike Forumite
    587 Posts
    Ok, so I'm going to round the £240 p/m target up to £250 starting from July 2012, so will be aiming for £1,500 over-payment between now and the end of 2012.

    I run a tuck-shop at work which I'm going to put more time/effort into to boost my profits. This is good as it also reduces the amount I spend on dinners etc. I'm also going to cut down on my chocolate intake to increase profits (overpayments :p)

    I have also (successfully) talked my better half into reducing our takeaway night from once per week to once per month, which should add a further £30+ to the overpayment pot.

    Tonight I'll make a start on ebaying some items and we'll take it from there. I'm excited about this!
  • DawnWDawnW Forumite
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    You look really motivated! I need to get some of that back :o

    Good luck :j

  • cufc_mikecufc_mike Forumite
    587 Posts
    Looking for a bit of advice from our mortgage experts. One of my mortgages is with the Nationwide. Because it's base rate, I can overpay as much as I like without incurring any early repayment fees.
    This is what the Nationwide say about overpaying on my particular mortgage:
    "If you overpay by less than £500, your monthly payment will be reduced at the next rate change. Your interest is calculated daily, so your overpayment will still reduce your balance immediately and you'll start to be charged less interest, but your monthly payment won't reflect this straight away."

    If I overpay by £500 or more, I can choose whether to reduce the monthly payments, or to reduce the term. The question is...what is best? Do I make little/often overpayments, which will reduce the monthly payment, or do I save up my extras until I reach £500 and then overpay £500, thus reducing the term of the mortgage? Is it more beneficial to do it one way (reducing the term) than the other (reducing the payments)?


    On another note, I emptied all our copper/5p/silver jars the other night and totted it up to £83 - I was even more surprised when i found £30 of notes in one of the jars as well. That's £113 towards next months overpayments already :)
  • DawnWDawnW Forumite
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    I'm by no means an expert, but the way I approach it is to pay whatever I can off as and when. If the OP reduces the balance (and hence the interest) immediately, surely that is the key thing?

    Surely reducing the term is pretty meaningless if you intend to pay it off before the end of the term?? My term doesn't end till 2018 (they wish :p) but there is no way it is going to hang around after the end of this year! Likewise payments - I see the required payment as a minimum payment, like when you are trying to pay off a credit card (been there!) where you pay wnatever you can afford on top of that.

    Or perhaps I have it all wrong?

  • cufc_mikecufc_mike Forumite
    587 Posts
    Thanks Dawn :) I've been good so far this week, haven't bought anything I've not needed to - not a penny wasted. The July challenge is on!

    Also decided to start comping again which will hopefully bring in some things to ebay :)
  • cufc_mikecufc_mike Forumite
    587 Posts
    I don't whether I'm going overboard but I sat down on Sunday evening to do my weekly shop....except this time I was going to do a bigger shop (monthly) and try and save money in places.

    My wife called me crazy when she found out I had a Tesco delivery booked for last night and a separate ASDA delivery booked for tonight. I worked out that doing the order (with the same items) at just Tesco or just ASDA would've been £22 more expensive. The additional delivery cost me just £3 as I took a late slot,so I put that down as a £19 saving - towards my overpayment pot :)
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