Stick with huge mortgage or downsize

happydays_70

I haven't posted before but I am in a real dilemma. I read the posts all the time about saving money to cope with my existing budget.
I have a very large mortgage on a beautiful house in a brilliant area. I live with my two children and I work full time.
My mortgage will only be paid off in 27 years..making me 69 then!
I have budgeted and been very careful with my money so that my children have had no upheaval. Their dad left 5 yrs ago and I have continued to pay the mortgage myself.
The dilemma is do I stay and slowly chip away at the mortgage or do I look to sell and buy something cheaper but smaller. I would have more disposable income for when the children get older and more expensive (they are 11 and 8).
I see the current house as an investment for them in the future. Also my csa payments will stop long before my mortgage is paid off and I won't have that extra money towards the mortgage.
Any advice would be appreciated...I know it is my decision ultimately but really unclear as to what to do for the best.

Thrugelmir

Discard the property as a long term investment. It's your home.

Would you have a better quality of life with a smaller mortgage to pay?

Would you be better finding somewhere to make your home that you'll still live in when the children have flown the nest?

Personally that would be my line of thinking.

happydays_70

Thanks for your reply. We would have a much better quality of life if I could sell the house.
Another niggle with me though is that if I put the house up for sale I will have to stay on the variable which is more than a fixed rate the bank has offered me and I could chip a few years off...it is a slog. That is what is getting me down. Is it going to be worth it? I know that's hard to answer but that's my quandary..stick with the hard slog of large payments or try and sell?
Your questions do make me lean to sell.

hcb42

can you buy a smaller house, and reduce the term?

That term would scare me to death, to be honest.

If you can get a nice house, reduce payments and/or term, I would do it, it will be a weight lifting..

Thrugelmir

With 27 years to run. A high % of your monthly payment goes in interest. So you are building capital at a slow rate.

If you involve the children in the proposed move. You may well find it easier.

I don't think it matters where you live. As you'll make it a home. There's too much perception in this country of what others think. Rather than being satisfied with what you have. Property is well down my list of concerns. Had a lovely house once myself. But find my modest abode now far cosier! With only 2 of us. Don't need loads of empty barely used rooms.

happydays_70

Thanks for your reply hcb42. It does get me down. I suppose I am being stupidly materialistic and stubborn. Materialistic cos it's a big house with lots of space and its in a lovely area. Stubborn cos I wanted to prove I could do it on my own and this house has roots and memories..good ones.
Realistically I would probably pay off a smaller mortgage quicker with less interest paid over the term. It does make sense to try and sell doesn't it..just nervous.

happydays_70

Thrugelmir..I know you are right..just scared of the unknown. Glad I posted cos your thoughts have helped to confirm what I have thought at times. I live really frugally by necessity it would be lovely to take that pressure off and choose to be sensible with money. I have learned a lot in the last 5 years.

tiger_eyes

One factor (among others) to consider is that you may be able to overpay on your mortgage in future. In ten years your youngest child will be an adult, so your outgoings might be lowered, and you could also be looking at promotions at work, better-paying jobs, lump sum overpayments from savings, possibly inheritances or other windfalls. Twenty-nine years is a long time. I wouldn't necessarily assume that your financial situation will remain static and the mortgage will need to run to its full current term. Though there is of course the possibility that finances could get worse instead of better...

Thrugelmir

tiger_eyes wrote: »

One factor (among others) to consider is that you may be able to overpay on your mortgage in future. In ten years your youngest child will be an adult, so your outgoings might be lowered,

Child maintenance will disappear though.

Thrugelmir

happydays_70 wrote: »

Thrugelmir..I know you are right..just scared of the unknown. Glad I posted cos your thoughts have helped to confirm what I have thought at times. I live really frugally by necessity it would be lovely to take that pressure off and choose to be sensible with money. I have learned a lot in the last 5 years.

Then take your time. Light bulb moments are great. However think things through thoroughly. You'll know when the times right. Your head and heart will tell you.

happydays_70

Thanks again for your comments. I feel my waivering needs to stop. I am going to put the house up for sale. I will be on a higher interest rate but if it doesn't show signs of selling within 3 months I will apply for a cheaper fixed rate.