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Hey there I've been looking at these forums for a while but never had the courage to join in but need advice and by the looks of the posts on here im in the right place! I'd love to be a mfw but the volume of info here I simply don't know where to start! I built my own home roughly about four years ago mortgage 127000. To date its over 121000 with 27 years and 5 months to go. I think I can afford another 300 pm overpayment. Called the bank today they have said I'm allowed 1payment of 1000 pounds overpayment and that's it or any overpayment would cost a 3% charge. So I'm asking two questions. How do I start? And what do I do now cause I feel like I've been stopped in my tracks. Any help would be much appreciated! By the way I'm 32 would love to be mf by 40 is that crazy talk or realistic? Thanks in advance

Replies

  • HelenDaveKidsHelenDaveKids Forumite
    3.2K Posts
    Tenth Anniversary Combo Breaker Mortgage-free Glee!
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    Welcome.

    Personally that seems quite a small allowance to OP, is it an option to move mortgage providers? are you on a fixed rate? and when does it end?
    Morgage till Nov 30 GOAL MFW Sept 2016
    Aug 11 - £100k Aug 2016.... It's GONE!!!!!
    2014 GOAL HIT 5 Stone! 2016 GOAL to be a MF marathon runner.
    "A goal without a plan is just a wish"
  • Lois_ELois_E Forumite
    2.2K Posts
    Ninth Anniversary Combo Breaker
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    Hi echocharlie and welcome to MFW. :wave:

    Look into changing mortgages - either to another provider or to a more flexible mortgage with the same provider (so as to try to avoid fees for valuations and things). If switching mortgages doesn't make sense at the moment - if there are early exit penalties or whatever - then don't worry. Just open a savings account, and put all your "overpayments" in there - you can all it your OP pot, or your virtual offset, or whatever you like. Write yourself a signature listing not only your mortgage balance but also your savings and your net value of mortgage minus savings. (See my sig - I have all sorts of stats there!) That will keep you motivated and feeling that you are part of the gang on here. We're not all doing the classic "pay overpayments to the mortgage company" thing - we have all sorts of strategies represented, and everyone's welcome. :)

    Eventually it will be time to remortgage, and then you can pay all your OP pot off in one go - or keep some of it as an emergency fund. It's generally recommended to have 6 months' worth of essential outgoings somewhere where you can get at the money easily if there's a problem - like losing your job or something.

    Good luck, and enjoy the journey.
    Starting again 13/4/19
    Home loan 1: £21,102.50 Home loan 2: £7,698.99
    Total owed: £28,801.49
  • Hey helendavekids Thanks for your reply. It ends June 2014 my mortgage is 559 pm do thought between 200-300 overpayment would get me started until I worked out how it all worked do you think this isn't enough because I can try to raise more in the future. Oh by the way it is fixed
  • Lois-e great advice Thanks Ive considered putting the money in a savings account because when I checked today some of money was making no interest and the other was making 2.5 percent that prompted me into concentrate on my mortgage as to date its my only debt
  • BufgerBufger Forumite
    1.9K Posts
    Part of the Furniture 1,000 Posts Combo Breaker Debt-free and Proud!
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    with a remortgage next June you'll be best to save your £1000 and pay that in as soon as you have it and then save any extra until you remortgage. Make sure the new mortgage from next June is more flexible and allows overpayments.

    Mine allows 10% of the balance which is fine whilst I have a larger mortgage but as time goes by i'll look at an offset or something with unlimited overpayments.
    MFW - <£90k
    All other debts cleared thanks to the knowledge gained from this wonderful website and its users!
  • LauraJoLauraJo Forumite
    1K Posts
    Eighth Anniversary 1,000 Posts Combo Breaker
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    Try and put it in an account that you can't access too easily otherwise you might be tempted to spend it (well I would anyway!) You might find in June that you are not restricted on OP's. With my mortgage I had a limit until the mortgage tie in period was up and then I could OP what I wanted...defo worth checking.
    MF by 40 sounds like a great goal!
    Are you related to EchoDelta on here lol?!!!
    Mortgage starting balance 2011 ... £170k today £1.5k
    Savings: £3k
    Aim: 100k by Dec 2021
  • MallyGirlMallyGirl Forumite, Board Guide
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    Eighth Anniversary 1,000 Posts Name Dropper Intrepid Forum Explorer
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    I would take a look at some of the regular saver accounts as they seem to be offering the best interest at the moment until you are out of your fixed tie-in.
    I'm a Board Guide on the Debt-free Wannabe, Loans & Credit Cards boards. I volunteer to help get your forum questions answered and keep the forum running smoothly. Board guides are not moderators and don't read every post. If you spot an inappropriate or illegal post then please report it to [email protected]
    Any views are mine and not the official line of MoneySavingExpert.com.
  • Hey guys Thanks for all the great advice went to see a mortgage advisor and he said the same as the rest of you all. Sit on the money try and make as much from it as you can and by next year I'll have 70% or more ltv and then I'd be in a much better position. So from now until then it's heads down and put as much money away as I can at least it will be good practice to test my discipline in overpaying Thanks all I'll keep posting!
  • ixiaixia Forumite
    1.3K Posts
    Welcome and Good luck :)
  • Hey everyone Thanks For taking the time to read my posts and giving advice much appreciated. Just calculated today that if I put 300 pounds a month away a month until my fixed deal ends next year, add this to some savings I have that are making little interest I'll have 10, 000 pound to pay off in a lump sum plus I'll be in a better position to get a better deal. The thought of getting that money together then 'give it away! ' is abit hard to take at minute but the bigger picture makes it a good goal to aim for! I keep having to think to myself these low interest rates aren't going to last forever and will I be able to afford my monthly payments if the rates shoot up if I don't take action! I'd be interested to know your thoughts!
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