I've Done It!! I'm Finally Mortgage-free

Redbedhead

Congratulations on being MF:beer:

fluidthinking

Martinslove child...

Well done! An inspiration as I also have the MF before 40 goal!

Curious though on the quote... "I'm convinced that there'll be a housing market crash after 2010, hitting the bottom of the next cycle in 2013-2014"

I also feel there will be a reduction in house prices but you have some pretty defined dates here! Can I ask what this is based on?

MJB

This sounds great MLC.
I just wondered whether you ever had to panic about what credit limit the 0% cards would offer each time you had to switch?
eg i have applied hoping to switch about 6K to a 0% card and was only offered a credit limit of 3k.
Imagine if you've got 100K to switch (albeit on various cards) and you're not offered enough credit- then you're in a tight spot, no?
What would happen then...??

Desperate_Housewife_2-2

well done and congrats on becoming mortgage free!

Nellie1972_2

Congrats on becoming mortgage free - but don't you have lots of money owing on credit cards instead now? I'm sorry if I've misunderstood your explanation as to how you did it, but I would be very interested to find out as reducing my mortgage quickly is something I would very much like to do

Dead_Eye_Jones

good work!

I like the idea that the common perception of all Brits being up to their eyes in debt is clearly untrue.

Martinslovechild

fluidthinking wrote: »

Curious though on the quote... "I'm convinced that there'll be a housing market crash after 2010, hitting the bottom of the next cycle in 2013-2014"

I also feel there will be a reduction in house prices but you have some pretty defined dates here! Can I ask what this is based on?

Sure - this is a pretty hot topic as there are lots of theories on the subject! I read loads of books on the subject. One such book, by an American called H. S. Dent (check out his website at www.hsdent.com), compiles loads of statistical forecasts based on demographics, not only for house prices, but also the stock market. Although his last book was written in 2002, everything so far has come to pass just as he explains in the book. The other sources of information I use are the Nationwide House Price data (http://nationwide.co.uk/hpi/) and the simple fact that the UK housing market tends to move in cycles of 18 years (the next one strangely enough ending in 2010). All of these data point to the same thing - we're currently in a bubble which is due to burst in just over 2 years time. Going back to your original question - I've compiled my own predictions based on the historical Nationwide data (including affordability analysis) and concluded that the market takes 4 years to go from top (2010) to bottom (2014). My own analysis says that the below-trend period for house prices will occur during the years 2013-2015, making this period a buyers market.

MJB wrote: »

I just wondered whether you ever had to panic about what credit limit the 0% cards would offer each time you had to switch?
eg i have applied hoping to switch about 6K to a 0% card and was only offered a credit limit of 3k.
Imagine if you've got 100K to switch (albeit on various cards) and you're not offered enough credit- then you're in a tight spot, no?
What would happen then...??

I certainly did, but it only really became an issue when I already had £100,000 on credit cards and didn't need it all because my mortgage was less than this amount (any excess cash was deposited in a savings account).

The truth was certainly stranger than fiction; when I started out, I worried that I wouldn't be offered the same limits from the new credit card company - In fact, I tended to be offered even more! I found when I started out that I was offered limits of £6K, £8K or £5K. The next couple of cards offered higher limits of £10K & £12K. In fact, when I was up to £60K, I applied for a card offering 18 months 0% - I worried that I wouldn't be accepted because I obviously already had £60K on credit cards - I shouldn't have worried - they offered me a limit of over £20K !!

I also benefitted from the fact that not all credit card companies reported information to the credit reference agencies. Therefore, when I picked up copies of my credit reports, I found that several cards weren't even listed; I later discovered that several banks didn't report info to the likes of experian unless a borrower defaults. This benefitted me greatly because it appeared to new banks that I had a lot less credit than was actually the case!

I only started experiencing problems obtaining new cards when I was well over £100,000 in 'debt'. However, I found that I didn't really need cards because my mortgage was down to £80K, then £60K etc. I found that as long as I could sustain 0% offers with credit card limits matching the amount of my outstanding mortgage, I would be happy. If I'd had a couple of rejections in succession, my wife would apply for cards. One of us would always succeed. My wife no longer has any cards on 0% whereas I have just 3 cards. One card that I was about to cancel offered me an additional 13 months 0% with a 3% fee; needless to say, I've dropped £6,000 in cash ISAs (one for myself, one for my wife) and the remainder in a 6.3% savings account; in the meantime, I'll fund the minimum payments out of my wages and pocket the profits in 13 months time.

Joscar

Congratulations on being MF. :T

I set myself a goal of clearing our mortgage before my 30th birthday when I moved in with my chap 12 years ago. Two incomes, one mortgage and no kids meant we could over pay dramatically. We started off with just an extra 50 quid a month, but when we played with the numbers and realised how much interest we would save, we paid in a lump sum from a savings account and increased the repayments to 3 times the minimum, as a result it was cleared one payment before my 29th ! (Admittedly he was not quite so young and started his first mortgage at 19)

Technically we are not MF at present, as we now have 2 BTL properties which will eventually be a retirement income, however as we do not contribute to the repayments we do feel like we are mortgage free.

Martinslovechild

Nellie1972 wrote: »

Congrats on becoming mortgage free - but don't you have lots of money owing on credit cards instead now? I'm sorry if I've misunderstood your explanation as to how you did it, but I would be very interested to find out as reducing my mortgage quickly is something I would very much like to do

Nope - as the mortgage balance came down, so did my 0% balance. The two things, more or less, were approximately the same value throughout the majority of the 6 year period. Therefore, when I owed £80K on the mortgage, I had approximately £75K at 0%; when I owed £20K on the mortgage, I had approximately £15K on 0% against the mortgage and £20K on 0% in savings accounts.

I currently have 3 outstanding 0% balances but the money is all deposited in ISAs and savings accounts - I don't actually 'owe' any money on these cards as it's all available with instant access should I need to repay the cards.

COOLTRIKERCHICK

well done....MLC....:T

its not often i venture on to this board on mse....

but it caught my eye in martins email.....

now done a little bit of stoozing with the credit cards...jumping from one 0% to another etc.....but as the repayments for all our financal commitments were over what we had coming in we re-mortgaged.... and added another 3 years on to the term...:eek: basically to get ourselves back on track and to stop us from sinking in unmanageable debt....

i have one question ( which will prob.. sound very basic and silly )

i was thinking of maxing out a 0% credit card and putting the money in a high interest account.....now this is the question......if i transfered money from a credit card to let say a saving account..... surely this is like taking a cash withdrawel from the credit card so you get charged ? or does trasnfering money from a credit card to a bank/savings account is like paying off another credit card..?

hope that makes sense and doesnt sound a stupid question....

mlc...... your mortgage free journey has inspired me to TRY and find/save money for my dream...( buying a small holding ) dont know if i can do it but hay.... if i dont try.... i will never know......