Catriona's Credit Card Countdown

catriona79

Orange_Ena wrote: »

Hey Catriona, I quite agree about staying on the forum for focus. I took my eye off the ball and I'm in a mess again

Gosh that is brilliant income. I have had a look at that website you mentioned and as it's only a single room, in my area I could get about £320 pcm. I think by the time I lose my council tax discount and pay extra utilities, I could make about £275 profit. Money for doing nowt!

I think the payoff would be worth it. And it will make me tidier, and be nice to have the company. Sorry to hear you had a nightmare lodger, I suppose you just don't know until someone moves in. But good that you've got a good one now.

I don't think I'd have too much trouble letting it. I live about 5 mins from a station and there are a few industrial estates in driving distance. There's also a college quite nearby that has visiting students. I would prefer a professional for sure, preferably a Monday to Fridayer but as long as I get the right person. I really need to get that room cleared and decorated and start bringing the money in. Trouble is my room is shocking too but once someone moves in, I can't move everything around to get the work done on either room but without the lodger, I can't afford to pay for the work to be done yet! Catch 22 I've already got a bed in there so I'd just get a little wardrobe and a chest of drawers, maybe a desk if necessary. I'd pretty much sort out what the right lodger would want, but nothing extravagant. If I've got ike@ furniture in my room they will not be having Next furniture!

Sound like you've got a really good plan there. Maybe you could rent the rooms for a few more years, pay the mortgage off and retire early? :rotfl: Nice to have options anyway

Thanks for advice Catriona, much appreciated. Operation clearthespareroom has commenced

Sounds like you've hatched a good plan!

I'm just looking at furniture and have seen a wardrobe in ikea for £39, and it seemed sturdy enough. Need a chest of drawers too, but not a desk. A friend of mine who's a lettings agent says wait till you've found the lodger. Mine had her own bed, yours might have some stuff too.

Sounds like a cool new way of life, if you turn it around for yourself and look on the bright side, it's often much better overall. You feel Better and the world outside seems better. A lot of it is in the mind. I don't know what state your room is, bit I've used rug doctor before (£25 per day to rent) on carpets and they do look fab, alternatively look for deals on Gr%upon for profesional carpet cleaning, one room is usually about £15. I know what you mean about the catch 22, been there too frustrating. Hopefully you can get it on a credit card and then pay off with the first lot of rent. I'd advise that you get a good blurb written up, to make sure that you get the right person, and be open about what you like doing, what your expectations are. If you live with them, you can't pretend long term, you do have to get on. Well, you don't Have to, but it's easier if you do, and it's your home after all. I've had times when I didn't want to go home before... But equally had some great lodgers! My current one is a sweetie.

You can do it, and an extra £275 is fab! Just think, that's £3300 a year!

catriona79

Orange_Ena wrote: »

Hope the delivery isn't too much but so much better than going to the store, buying something then figuring out that no matter what angle you try it, it will just not go in the car. And then having to console yourself with meatballs. No......this has never happened to me! :rotfl:

He he - meatballs, yummmmmm!

Good luck with your ventures and let me know how you're doing

Orange_Ena

catriona79 wrote: »

Sounds like you've hatched a good plan!

I'm just looking at furniture and have seen a wardrobe in ikea for £39, and it seemed sturdy enough. Need a chest of drawers too, but not a desk. A friend of mine who's a lettings agent says wait till you've found the lodger. Mine had her own bed, yours might have some stuff too.

Sounds like a cool new way of life, if you turn it around for yourself and look on the bright side, it's often much better overall. You feel Better and the world outside seems better. A lot of it is in the mind. I don't know what state your room is, bit I've used rug doctor before (£25 per day to rent) on carpets and they do look fab, alternatively look for deals on Gr%upon for profesional carpet cleaning, one room is usually about £15. I know what you mean about the catch 22, been there too frustrating. Hopefully you can get it on a credit card and then pay off with the first lot of rent. I'd advise that you get a good blurb written up, to make sure that you get the right person, and be open about what you like doing, what your expectations are. If you live with them, you can't pretend long term, you do have to get on. Well, you don't Have to, but it's easier if you do, and it's your home after all. I've had times when I didn't want to go home before... But equally had some great lodgers! My current one is a sweetie.

You can do it, and an extra £275 is fab! Just think, that's £3300 a year!

Haha just wedge the wardrobe between the wall and chest of drawers, that will keep it vertical

The carpet in my spare room isn't too bad, it's the walls, radiator, blind and door that need sorting really. I'll get there! Good idea about Groupon, a little clean of the carpet wouldn't be a bad thing. I've half started making a list of things to go through with a potential lodger, and a list of things I need to do, like inform council tax people etc. There's a lot to think about! I rang my mortgage lender to ask if it's ok and they've already sent me a form that I need to get the lodger to sign to say they've got no rights or something! I hope I get a good lodger, otherwise a bad experience will put me off forever!

Blimey, £3300 a year? Ooh I could could have a lovely cruise with that. Oh....wait a minute........debts first!! Haha :rotfl::)

Hope you've had a good few days

catriona79

Orange_Ena wrote: »

Haha just wedge the wardrobe between the wall and chest of drawers, that will keep it vertical

The carpet in my spare room isn't too bad, it's the walls, radiator, blind and door that need sorting really. I'll get there! Good idea about Groupon, a little clean of the carpet wouldn't be a bad thing. I've half started making a list of things to go through with a potential lodger, and a list of things I need to do, like inform council tax people etc. There's a lot to think about! I rang my mortgage lender to ask if it's ok and they've already sent me a form that I need to get the lodger to sign to say they've got no rights or something! I hope I get a good lodger, otherwise a bad experience will put me off forever!

Blimey, £3300 a year? Ooh I could could have a lovely cruise with that. Oh....wait a minute........debts first!! Haha :rotfl::)

Hope you've had a good few days

It's only pay day! Woo hoo!

Helo Ena, when do you get paid, are you celebrating too? It's always on the 28th for me and that's when my mortgage gets paid, but then bills go out on 1st, and then the account looks bare again;)

The rent a room scheme sounds like a good idea and you can do it! It's just a matter of getting organised, I'm sure. That's what I'm going to do. It's another 2 weeks until my new lodger moves in so I'd better get a move on!

He he re wardrobe! Hopefully not too rickety!!! :rotfl:

Who are you with mortgage wise? I'm with hsbc, but thinking of changing to a new provider and will then have to get the form from them too.

Yes, make sure you trust your instinct and interview in a nice way and without undue pressure ( you don't want to put them off), but being clear on your non-negotiables. They are different for different people, and bear in mind that it will not be exactly the same as when you live on your own. But for all the compromises, it can be fab! A new social circle, cup of tea and chat on the sofa after work, a new friendship. I really recommend heartily. Just make sure it's the right person.

Right, time for sleep

catriona79

Hello hello

Well, some good news for me. Future lodger wants the cheaper wardrobe from ikea, which is great news. I might go pick it up tomorrow after work. Would be great to just get it done. Plus a chest of drawers!

I'm trying to think of what else needs to be got, quite possibly one of those stick on things to put on the window pane, to stop people being able to see in.

Blinds! And they will have to be made to measure, as the windows are humongous.

Or maybe I should have the original windows ripped out and new ones put in? I love the old style windows, but it's noisy and cold....

Time for sleep now I think.

I'm excited about Aug 1st, as that's when my regular saver matures. I'm such an mse geek.

catriona79

Well, so it's Saturday morning, I'm having coffee in bed and thinking about my mortgage.

The situation is thus:

Mortgage - 100,450 outstanding over 25.5 years, moved from a 2 yr fix to HSBC's standard variable at 2.49%. This has saved me £45/month, so I'm not complaining.
Homeowner loan secured on the house - 10,270 - this was initially taken out for 8 years, so must have another 6 to run. Same standard variable as mortgage.

Current payments are £590 for both (£440 mortgage and £150 loan)

So, the plan...

Plan A - change mortgage provider

I'm thinking of bunging those two together into one payment and going with another motgage provider. I've been told by my friendly L&C mortgage advisor that a new lender would take it on as one sum, not split between two, but that's ok. I've worked out the amounts below based on the MSE mortgage calculator.

The options are, after consolidating into one payment:
1. Move onto another tracker/variable deal. £440 a month total.
2. Move onto a 2 yr fix. £450 a month total. (Op allowed)
3. Move onto a 5 yr fix. £480 a month in total. (Op allowed)

I understand that the numbers are lower because of the consolidation, but I could still happily overpay.

The important additional thing to consider now is that I really want to change careers and this would mean getting back to uni for a conversion course, so the 5yr fix would actually help me do that, especially if I had to start out on a lower salary, which I would have to do. I am also thinking of doing a doctorate, which doesn't pay very much. But obviously, I have my rental, income which is fab. This rental income would see me though the career change.

Therefore, Plan B - change mortgage provider and get additional borrowing

I am considering taking another £35,000 out of the house and converting my attic into a bedroom with a shower room. There's lots of room there, and the architect was impressed with the ceiling height too. I could then have my own chilling space and bathroom, and would feel a bit better about sharing with others in my late 30s. I do like my own space. So if I'm thinking of renting out for a long time, that might be the way to go. The LTV would then be 70%, because I'd have to take the mortgage out and only then develop the attic.

Then the respective mortgage amounts would be:
1. Move onto another tracker/variable deal. £590 a month total.
2. Move onto a 2 yr fix. £565 a month total. (Op allowed)
3. Move onto a 5 yr fix. £655 a month in total. (Op allowed)

Plan B(2)

If I took the additional borrowing out, converted the attic, had the house valued (one like that sold last month two doors down so I know the price), then it would return to 60% LTV and then the mortgage would be:

1. Move onto another tracker/variable deal. £579 a month total.
2. Move onto a 2 yr fix. £580 a month total. (Op allowed)
3. Move onto a 5 yr fix. £632 a month in total. (Op allowed)


Hmmm.... With the difference between the fix and variable a month, I'm thinking the fix might be the better option, especially over 5 years. There's a great deal of security to be had there, for not that big an outlay. Obviously, questions arise around what happens if I meet someone and want to move, but I guess I have to plan the best course of action for myself, so should only really look at what is now.

Any opinions greatly appreciated.

catriona79

I forgot to do an update after the last pay day.

So here we are:

Halifax CC - £6200 – 0% until March 2016
Santander CC - £2900 – 0% until May 2016
Virgin CC - £1000 – 0% until January 2016
HSBC CC - £600 – 17% - need to pay off before 8/09 when it becomes interest-bearing
FD overdraft – £485 – 0%

Savings - £3,200

:eek::eek::eek: Total CC debt: £10,700. :eek::eek::eek:

This means that, one way or another, I have paid off 32.3%

Orange_Ena

Hi Catriona.

Well you have a few options there! And I can see you've really thought about it.

I've only ever had fixed deals so I don't know much about variable mortgages. I don't know how much variation it could actually be but knowing exactly what your payment every month is so worthwhile. I think I'd panic too much if it went up and up. But maybe that's just me. It depends what you're comfortable with. But if you're embarking on a career change, there is definitely advantages to knowing exactly what your mortgage payment will be.

Will you always have lodgers to rely on? What happens if they move out and you can't find anyone suitable to move in? Just things to think about really. Knowing you can afford it on your own entirely is maybe something to think about, just in case. I'm really cautious and all this would play on my mind. Years ago a mortgage advisor told me I could afford another 2-300 a month but I didn't want to be a slave to the mortgage, especially as I'm on my own. I feel lucky to have the house I've got and as long as got a roof over my head, that's amazing. I've seen friends move and move and move up the ladder to get a bigger place and their mortgages are scary. If anything happened, they'd be in the doo doo. I'd rather have wriggle room and the chance of a holiday once in a while than just work to pay the mortgage. Over payments would be lovely once I'm debt free, but that's a more satisfying way of clearing the mortgage in my opinion. Choosing to over pay rather than struggling to pay just the basic mortgage payment.

As for the attic conversion, well it would definitely add value and you'd have a great asset. I know this is probably a bit negative, but I always think, if things went terribly wrong, I could always sell the house. It wouldn't be the end of the world. It's kind of a comfort knowing there is a plan B. Hopefully won't happen though!

Yeah I agree, plan for now, not what may happen.

Good luck with the decision making. I've probably been absolutely no help lol :rotfl::)

catriona79

I'm having a looooovely day off today. Pain au raisin and coffee with a dear friend in the morning, then afterwards put up some pictures and made the house look nice. Now the sky engineer has arrived and is moving the sky socket! So a bit of mess to be tidied up later

But in readiness for 2nd lodger moving on, I've looked through the freezer and am determined to eat up all the stuff that's been there forever. Need to clear out a drawer for new girl and a cupboard too - this means being strict with myself and eating what's in there. So I'll have to get creative.

This will mean no spend on food.

I went to ikea yesterday and bought a wardrobe and a chest of drawers for the room, the lodger is bringing with her her own bed, so that's a saving. It's should all be good

And I've been religious about YNAB

I love days off!!:)

catriona79

Orange_Ena wrote: »

Hi Catriona.

Well you have a few options there! And I can see you've really thought about it.

I've only ever had fixed deals so I don't know much about variable mortgages. I don't know how much variation it could actually be but knowing exactly what your payment every month is so worthwhile. I think I'd panic too much if it went up and up. But maybe that's just me. It depends what you're comfortable with. But if you're embarking on a career change, there is definitely advantages to knowing exactly what your mortgage payment will be.

Will you always have lodgers to rely on? What happens if they move out and you can't find anyone suitable to move in? Just things to think about really. Knowing you can afford it on your own entirely is maybe something to think about, just in case. I'm really cautious and all this would play on my mind. Years ago a mortgage advisor told me I could afford another 2-300 a month but I didn't want to be a slave to the mortgage, especially as I'm on my own. I feel lucky to have the house I've got and as long as got a roof over my head, that's amazing. I've seen friends move and move and move up the ladder to get a bigger place and their mortgages are scary. If anything happened, they'd be in the doo doo. I'd rather have wriggle room and the chance of a holiday once in a while than just work to pay the mortgage. Over payments would be lovely once I'm debt free, but that's a more satisfying way of clearing the mortgage in my opinion. Choosing to over pay rather than struggling to pay just the basic mortgage payment.

As for the attic conversion, well it would definitely add value and you'd have a great asset. I know this is probably a bit negative, but I always think, if things went terribly wrong, I could always sell the house. It wouldn't be the end of the world. It's kind of a comfort knowing there is a plan B. Hopefully won't happen though!

Yeah I agree, plan for now, not what may happen.

Good luck with the decision making. I've probably been absolutely no help lol :rotfl::)

Hey Ena,

You're spot on about the risk of variable mortgages. I'll have to keep looking and make a decision in the next couple of months I think.

I think I can safely say that I'll always be able to have at least one lodger if I want one. I've rented my spare room in the last 4 years several times and could always find so done suitable within a couple of weeks. I think it's because the house is quite comfy and renovated, so nicer than the standard rooms for let. I have always been able to pick and choose.

But you made me think about doing something to reduce the outgoings on secured and unsecured debt. At the moment, I pay £438 for mortgage, £150 for homeowner loan secured on the house and cheap and anything between 200-300 on cards (this is a bit over the min payment). But what your questions have led me to, is that if I buckled down, I could really reduce my outgoings by 350-450 a month by just paying off the debt. So I'll start with the cards, and then see whether to stick the homeowner loan on my mortgage too.

That would free me up loads.

But there's always change in life, so I'm going to see what happens with this new lodger and how it works out. Maybe after I've paid off the cards, I can just have the one lodger.

In theory, I've only got 6k more to save up to be able to pay them off.

Can't sleep, too busy thinking