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Ambitious plan
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Ha ha my OH was exactly the same about a lodger. I let him make the choice (girls strangely enuf!) and showed him the figures ( the numbers not the lodgers!) once I showed him how it impacted the plans he was gobsmacked about the time it takes off and put up with it! The last 2 have been great and they are now mates too...Mortgage starting balance 2011 ... £170k today £1.5k
Savings: £3k
Aim: 100k by Dec 20210 -
Hi I am also with NW and my understanding is that the ERC is for the whole amount of the mortgage. That's why am always nervous making my online over payments.0
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I called Nationwide again and this time I had a little more information.
The lovely lady at Nationwide told me the following in summary:
I pay 4% ERC on the amount above the allowed £500 overpayment. The 4% ERC is not deducted from the amount but added to the outstanding balance as a fee.
So if I pay £1000 above my allowed £500 I will have to pay £40 (4% of £1000) so the balance will drop with £1000 and then increased with £40.
This fee is interest free until January. You can however pay of the fee directly if you want. What you need to do is wait until the fee appears and then make an overpayment that is the same amount as the outstanding fee. Then call Nationwide and tell them it is not an overpayment and that you want to pay off the fees.
It wont save any money the first year but the years after that it will save £40 a year. The bigger the amount the more you safe.
Please contact your bank to ensure the same applies to your mortgage.0 -
Little update:
After increasing the monthly payments we did manage to keep making overpayments and increase our backup. So we decided to push it a little further and increase the monthly payment again.
On top of that we still make our monthly overpayments but we can skip this is something bad pops up. We do however have a decent backup so this shouldn't be needed.
On average we have around 100,- left per month so we are pushing it quite a bit. We are very frugal and write down every expense to keep a close eye on every penny. Not easy mostly because we do have money and we would like to buy some nice things (like Tropicana) but the great thing is that doing all this effort will allow us to pay of the mortgage in March 2017. The total journey would then have taken 6 years to be mortgage free!
The reason for posting this is that I want to encourage people to do the same. I am 25 years old and bought the house in March 2012. I have an average job and so does my other half. I have been lucky that everything went well so far and hope it will in the future.
My current mortgage balance is: 139,000 so we dropped 8000 since we increased the monthly payments (Apr 2013) :j0 -
Little update again:
Things are still going well and the mortgage dropped to 98,000. A very nice drop of 41,000 in 10 months.
If all goes well we have paid of the mortgage within 2 years and 2 months. That would be just before my 30th birthday.
I have to confess that it is getting harder to do. We have been on this road for almost 4 years (from starting to save for the deposit). And I know it is only a bit left but remaining disciplined isn't easy.
One big question I have is what to do when the fixed mortgage ends in April. Do I go for the standard rate and pay it off in roughly a year or do I go again for fixed with a 2 year term?0 -
I thought lets update this little threat, I did not manage to do it in 2 years and 2 months. Last year I went on a two holidays (nothing crazy, kept a budget) and did some home improvements.
So we have 1.5 months left so very very happy! :j0 -
And it is done, we called Nationwide this morning and made the final payment. It feels a bit strange now it is paid, we`ve worked hard for it and been more than frugal (with a few exceptions) but still cant believe I have no debts anymore.
Next thing is to get my savings back as we dont have any at the moment (paying off the mortgage went first...)
:beer:0 -
How fantastic! You've both worked very hard to smash that mortgage down!
Enjoy your mortgage freedom!! :beer:
:j:j:j:beer:First home- Oct’16 until June’21: £170.995- Overpayments made £13,784 (25% extra!).
New forever home- Sep’21 £309,449 @ 2.05%. Plan to clear it before 30 years!!!!!!0 -
Well done, that's great! Enjoy your achievement£400,000 starting Jan 2020 current end date Aug 2041 I would love the end date to be 2027 but will aim first for 2037.
1% target £4000 so far £20 paid0 -
Investing almost certainly will outstrip the mortgage...This is a system account and does not represent a real person. To contact the Forum Team email forumteam@moneysavingexpert.com0
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