Mortgage Free in Three Yrs

angelavdavis

Sorry to hear things are tough at the moment now SG. Hopefully things will pick up again. Best wishes Ange x

setmefree2

Hi SFG,

Hope things get better soon.

korky

Hi,

I am a newbie but but have been saving hard with the intent of paying of my mortgage for the last 2 years.
I had to realign my mortgage and now have a £120k mortgage over 25 years and have a current 2 year deal, i have saved £20k and intend to pay this of when i get a new deal in April next year.
Would it be better to continue to lump sum pay off the dept every 2 years or

1, Over pay by £300 per month ?
2, Reduce the term with a higher repayment ?
3, Continue as i am ?

Thanks,

Korky

PS- Can i still join or is it to late ?.

Kaz2904

It depends on your circumstances.
What interest rate are you paying? Can you earn more in an ISA? Have you filled your ISA allowance? And your partners? Can you earn a higher interest rate from a savings account? Are you allowed to overpay? If so how much?

Most of the time you can beat a mortgage rate with an ISA. If you are able to shove loads in and then continue to save and know that you will have to remortgage soon then you may fare better from an offset mortgage which allows you to count your ISA.
I will be hunting more of these out in 2010 as I need to remortgage then but the only one I know of ATM is the IF one.
Having said this it is still possible to beat their interest rate with a different ISA so the plan would be for me to fill my best paying ISA yearly and then transfer it to the mortgage at the end of the high interest rate! So that could mean that I should avoid an ISA offset as I may be able to transfer into an ISA which pays a higher rate than my mortgage IYSWIM. Whew!

OverlandLandy

korky wrote: »

Hi,

I am a newbie but but have been saving hard with the intent of paying of my mortgage for the last 2 years.
I had to realign my mortgage and now have a £120k mortgage over 25 years and have a current 2 year deal, i have saved £20k and intend to pay this of when i get a new deal in April next year.
Would it be better to continue to lump sum pay off the dept every 2 years or

1, Over pay by £300 per month ?
2, Reduce the term with a higher repayment ?
3, Continue as i am ?

Thanks,

Korky

Thats a difficult one to answer without all of the detail behind your loan.
It does depend when your interest is calculated, what rate you are on, are there any penalties for overpaying etc....

There are a few 'watch outs' & thoughts

If you make an overpayment make sure that it is a 'capital repayment'.
Find out if your interest is calculated on a specific day of the month/year if so ensure you pay before this day (so that overpayment's can be taken into effect).
If you are saving up £20k / year an offset mortgage may suit you (as all money is offset against the loan, usually on a daily basis,) If you are a high rate tax payer it has the advantage of reducing your tax bill on savings to £0/year. I know you can ISA - but you wont get it all tax free at £20k/year. I have one and I quite like seeing how much interest i save every day....however its not a good choice if your tempted to 'dip in' to your savings pot.

Hope that helps.

freebird65

Just been having a catch-up.....congrats angeladavis and jillinoz on your media-star moment! Any chance someone could send me a link to the article?

To those of you with shares....one lesson I learnt the hard way during the dotcom bust is to set a stop loss!! I can't stress this enough. Mine is at 15% which means that if a share drops 15% I sell, no matter what. The stop loss moves with the share price so as a share rises, so does the level at which I'll sell. Never wait for a share to recover and think oh I'll sell when it gets back to that level - I did that and lost £4K! I also have quite a lot in ISAs - mostly funds which I'm happy to let ride during market volatility and some shares which I actively trade. I'm considering cashing it all in to put into my mortgage, but am still dithering.

Back to listing on ebay I go......I've had a ruthless clear out and am selling absolutely everything I can live without and that wasn't a special gift from a loved one. So I'm saying goodbye to my Steiff bear collection....did you know a collection of teddy bears was called a Hug?

TallGirl

Hope you are all well, everything is fine here got my issues at work sorted out and work will now slow down for Christmas. However I shall have to spend nearly a week at HQ in a hotel so no food expenses etc for me but quite boring really and my laptop still cannot get onto the MSE Forums as has a childlock on it.

Still doing OK on the reducing mortgage front, DH has agreed to offset his birthday money and has finally paid himself some petrol expenses from work.
We both needed the dentist and DH has really bad teeth so not sure how much that will come to.

Starting to talk about next years holidays, will need to go and see the family in Denmark but question is do we fly and not have a car (borrow from family) or do we pay a lot more and take the car over. That way we are fully independant and I can bring so much stuff back from Denmark. Problem with having to go and see family it does not leave you with a lot to go on a hot and sunny holiday. Hopefully we will get a week or so to do that.

Well enough ramblings from me just wanted to say hi again.

PS I have updated the chart with those who PM me in the last month next update is not until 15th January but you are welcome to PM me now. I can't PM DD the list as it is too large hopefully I will get his email address and we can do it that way.

esthomizzy

I get my updates every month (in sig) but if the official date is 15th Jan I will just wait for that (as Dec payment will show through by then as well).

I'm still keeping with the extra 200pcm overpayment and my temporary lodger is working out really well (half way though the 6 weeks). He's from the Ukraine and the most polite lovely guy, he's even invited us to come and visit him some time next year to see the place. Unfortunately I can't put all that money against the mortgage as it has to back fill the money I spent on my holiday in Cambodia (ticket only as I vistited a friend, but unfortunately just the ticket was very expensive).

OverlandLandy

esthomizzy wrote: »

Unfortunately I can't put all that money against the mortgage as it has to back fill the money I spent on my holiday in Cambodia (ticket only as I vistited a friend, but unfortunately just the ticket was very expensive).

:cool: Were You a Dead Kennedys fan in your youth?

Hope you enjoyed it - another one on my 'places to see before I die' list.

esthomizzy

It was amazing. I spent most of the time in Kampot which is still really remote and out of the way and everyone is really friendly. Some people I met (more well travelled than me) told me that rural Cambodia is how rural Thailand was 10 years ago before tourism really kicked off in a big way. I also made the trek to Siam Reap to see the temples which was well worth it. If you do go make sure you go to Ta Promh (in my opinion the best of them, trees grow in the ruins and it's very atmospheric).