MFW from day one of the mortgage!

Greetings my fellow MFW.

I hope over time I can learn from you all, and in someway you can all learn from me. I am very excited about the journey, I have started and love reading other people's stories on here.

Okay so I have a mortgage eeek! It's not massive, but it's a first time buyer mortgage and anytype of debt eats away inside. This is the first time I have ever ever had debt (apart from a student loan).

I will will sort out my signature later, and also ask some questions about mortgages on here, as to be honest I really don't see how I can track my overpayments properly. It's all dutch to me!

Anyway, I bought 6 months ago a lovely two bed flat on the firstbuy scheme. A government thingy where I get a 20% equity loan and a 75% mortgage.

I think my mortgage is less than 75% as I put down a bigger chunk as my deposit.

The debate for me is do I:

A) Over pay the mortgage for the first 5 years - and then remortgage to buy out the government equity loan after the 5 year interest free period?

or

B) Do I try and save the money to buy them out sooner in case the house prices rise in my area?

I would appreciate people's views on this.

If I was to double pay the mortgage every month from day one, I would clear it all in 9 years and 7 months. A big ask! This of course would still leave the goverment loan. Hmmmm

I am looking to find ways to earn extra money, to save money, and to control my spending (although expensive sandwhich from boots everyday at work etc).

I am setting this blog up on here, to learn from people and also to hopefully pass on my knowledge in exchange. At the same time, I am also setting up an external wordpress blog, which will run adverts which may help to earn me some money to over the pay the mortgage also.

Any other ideas, thoughts or opinions, I can't wait to hear them.

Here comes the journey!
MFW: Original December 2041 / Aim January 2028
Current total overpayments: £0 Mortgage starts Dec 16
It does not matter how slowly you go as long as you do not stop. Confucius
«134567

Replies

  • gallygirlgallygirl Forumite
    17.2K Posts
    Part of the Furniture 10,000 Posts Name Dropper Mortgage-free Glee!
    Forumite
    Good luck on your journey :)

    I'm afraid I can't advise on the benefits of OP vs Govt Loan - don't know how the scheme works. I suppose it depends on what happens to house prices - am I right in thinking you pay the % of the value at the time? What are the interest rates on both parts? Are they both fully flexible - can you OP as much as you want? Can you ask for your OP's back?

    Re tracking your OP's - most of us have set up our own spreadsheets on here - or try this:
    http://www.locostfireblade.co.uk/spreadsheet/Index.html

    Re buying your lunch - :naughty:. Naughty naughty :naughty:. Stick the details in HERE and see if that puts you off. And just to be on the safe side, bung the cost into locoblades spreadsheet and see what a difference that would make ;).

    GG :)
    A positive attitude may not solve all your problems, but it will annoy enough people to make it worth the effort
    :) Mortgage Balance = £0 :)
    "Do what others won't early in life so you can do what others can't later in life"
  • gallygirl wrote: »
    Good luck on your journey :)

    I'm afraid I can't advise on the benefits of OP vs Govt Loan - don't know how the scheme works. I suppose it depends on what happens to house prices - am I right in thinking you pay the % of the value at the time? What are the interest rates on both parts? Are they both fully flexible - can you OP as much as you want? Can you ask for your OP's back?

    Re tracking your OP's - most of us have set up our own spreadsheets on here - or try this:
    http://www.locostfireblade.co.uk/spreadsheet/Index.html

    Re buying your lunch - :naughty:. Naughty naughty :naughty:. Stick the details in HERE and see if that puts you off. And just to be on the safe side, bung the cost into locoblades spreadsheet and see what a difference that would make ;).

    GG :)

    Hi,

    Yes I pay back 20% of the value when I pay the government loan off. The loan itself is interest free for five years, then I think it is 1% in year 6, and adds on 1% per year after that.

    The mortgage is 2 year fixed at 3.99% which I didn't think was too bad. Then I look to remortgage I guess..but I intend to smash it down in two years.

    Max I can over pay is 10% per year - doubt I will get that far.

    I will look at the spread sheets - I get confused as the banking mortgage statement changes daily up and down, but the interest is not added on untill the end of the year, so I don't see how it can go up?

    The sandwhich thing is bad...I never used too..one day I got lazy and didn't make pack lunch and then boom...it's been a slippery slope...eeek

    I got a feeling this blog and my other blog may help me sort it out.
    MFW: Original December 2041 / Aim January 2028
    Current total overpayments: £0 Mortgage starts Dec 16
    It does not matter how slowly you go as long as you do not stop. Confucius
  • Nothing major done today to help me clear the mortgage..but today I:

    1) Booked some ovetime at work
    2) Went shopping and bought food to eat at work, no more £3.49 meal deals each day for me.

    I worked out to buy food each lunch time is probably costing me about £80 a month, which I could save and put into the mortgage.

    Oh I wasted £2 on the euromillions last night and won £0 back.

    I made my online blog live too, so that will be interesting.

    So far I have managed to overpay my mortgage each month that I have had it. :T

    At some point today, I will sit down and work out my signature for this forum.
    MFW: Original December 2041 / Aim January 2028
    Current total overpayments: £0 Mortgage starts Dec 16
    It does not matter how slowly you go as long as you do not stop. Confucius
  • ajmoneyajmoney Forumite
    6.1K Posts
    Part of the Furniture 1,000 Posts Name Dropper
    Forumite
    Seeing as the interest on the government loan is so low and free at the moment I wouldn't worry about that. I would look at OPing your mortgage as you will have a bigger LTV when you come to look at remortgaging in 2 years. However only do this if you have enough savings in an emergency fund. If you were lucky enough to OP the maximum each year on your mortgage you could always save the extra in a separate account and build it up to either the amount of the government loan or to OP a bigger chunk at the end of the 2 years.

    A suggestion for a bit of extra cash, have you signed up to quidco? I check there first before I buy anything to see if I can get any cashback. If you register your cards sometimes you can get in store cashback and they have also started mobile check ins recently you get paid a small amount of pennies for logging in when you are near certain shops. I check whenever I am out if there are any shops near me.

    I look forward to reading your money saving ideas.
    MFW 2023 No. 7 £100/£1000 MFiT-T6 No. 70 £8271.89/£22787.04
  • ajmoneyajmoney Forumite
    6.1K Posts
    Part of the Furniture 1,000 Posts Name Dropper
    Forumite
    [QUOTE=version2014;56728255I_will_look_at_the_spread_sheets_-_I_get_confused_as_the_banking_mortgage_statement_changes_daily_up_and_down,_but_the_interest_is_not_added_on_untill_the_end_of_the_year,_so_I_don't_see_how_it_can_go_up?[/QUOTE]

    There is an easier way to do it, but I keep a spreadsheet (one of many) that I update daily with the total of mortgage, subtract the day before and that gives me my daily interest. I used to like seeing how the OPs made a difference to the interest on my old mortgage but I have made enough to make any difference to this mortgage yet.
    MFW 2023 No. 7 £100/£1000 MFiT-T6 No. 70 £8271.89/£22787.04
  • newgirlynewgirly Forumite
    8.5K Posts
    Part of the Furniture 1,000 Posts Name Dropper Photogenic
    Forumite
    Hi, welcome to the mfw board, it might be an idea to have a look on the oldstyle board for cheaper food ideas, there are threads on how to do cheap lunches so you don't get tempted by those meal deals.:D
    2022 MFW 67 - 33 month challenge to clear mortgage, month 3 completed and on track 🙂MFI3 No.12
  • ajmoney wrote: »
    There is an easier way to do it, but I keep a spreadsheet (one of many) that I update daily with the total of mortgage, subtract the day before and that gives me my daily interest. I used to like seeing how the OPs made a difference to the interest on my old mortgage but I have made enough to make any difference to this mortgage yet.

    How do you know when it makes enough to effect the interest charged?
    MFW: Original December 2041 / Aim January 2028
    Current total overpayments: £0 Mortgage starts Dec 16
    It does not matter how slowly you go as long as you do not stop. Confucius
  • newgirly wrote: »
    Hi, welcome to the mfw board, it might be an idea to have a look on the oldstyle board for cheaper food ideas, there are threads on how to do cheap lunches so you don't get tempted by those meal deals.:D

    Top idea...I failed today got up late..missed pack lunched spent £2 on a sandwhich grr
    MFW: Original December 2041 / Aim January 2028
    Current total overpayments: £0 Mortgage starts Dec 16
    It does not matter how slowly you go as long as you do not stop. Confucius
  • ajmoney wrote: »
    Seeing as the interest on the government loan is so low and free at the moment I wouldn't worry about that. I would look at OPing your mortgage as you will have a bigger LTV when you come to look at remortgaging in 2 years. However only do this if you have enough savings in an emergency fund. If you were lucky enough to OP the maximum each year on your mortgage you could always save the extra in a separate account and build it up to either the amount of the government loan or to OP a bigger chunk at the end of the 2 years.

    A suggestion for a bit of extra cash, have you signed up to quidco? I check there first before I buy anything to see if I can get any cashback. If you register your cards sometimes you can get in store cashback and they have also started mobile check ins recently you get paid a small amount of pennies for logging in when you are near certain shops. I check whenever I am out if there are any shops near me.

    I look forward to reading your money saving ideas.

    Does better LTV mean better % rate when you come to remortgage ?

    Is 6 months "emergency funds" enough?

    I do the quidco check in's, as you say not massive money, but I guess over the year it will build up.

    I am about to switch to Halifax and put the £5 a month into my mortgage! May as well let the banks, pay for a bit of their own mortgage.

    Idea so far..my new wordpress blog which has google ads on them. If someone click on an advert on my site I get paid! It's a new site, but hopefully it will take off over time.

    Broadband...I want it free...when I moved in I signed upto Plusnet got a cracking deal...

    Halfprice internet for 12 months, which £3 something per month - they have a customer referal thingy...so I get money per customer I refer...so far 1 reffered and £1 a month off my bill.

    Line rental paid 12 month up front and got it for £9 something a month.

    Much cheaper than BT! At present my BB costs me £2 odd a month...If I can refer 2 more people it will be nearly free...and after that other referral and the company start paying me per month.

    Gas and Elec went with utility warehouse (I am not a distributor)...but only because as a low user there service charge is dead cheap..and it works out cheaper for me that way. I can refer people to them too, to get a % off my bill...but not done that yet.

    If anyone wants to join plusnet for broadband please pm me and I can send you my referral link!

    More ideas to follow soon.
    MFW: Original December 2041 / Aim January 2028
    Current total overpayments: £0 Mortgage starts Dec 16
    It does not matter how slowly you go as long as you do not stop. Confucius
  • Epic fail day today....

    Got up late so no pack lunch £2
    Bought UK and Euromillions tickets £3 (prob wasted!)

    On the plus side I did do overtime at work, so earnt some money when normally I would not.

    Decided to do a "dreams board" and set some goals, after watching the law of attraction on DVD.

    Really must sort out my signature..so I know what my government loan is.
    MFW: Original December 2041 / Aim January 2028
    Current total overpayments: £0 Mortgage starts Dec 16
    It does not matter how slowly you go as long as you do not stop. Confucius
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