Mortgage free Wart

Worry_Wart

Hello,

I've only recently bought my first house, but after lurking on this forum area for years, I know it's important to crack on with the mortgage free aspirations early on.

I have a mortgage of £143,225 on a house valued at £168,500, fixed until May 2016, at a rate of 2.89%. I have just overpaid by £250, and set up a regular overpayment of £250 starting 1st September. I get periodic bonuses at work, so will aim to churn those in to the pot too, and I'll have more money as my interest free credit card gets cleared (£1800 remaining) and student loan (due to clear in a year or so depending on bonuses).

I do have a savings pot I put a bit into every month too, just in case a house emergency does come up.

My aim is to have 70% LTV by the time I need to remortgage in May 2016.

It is very, very easy to get distracted and spend money on buying fancy things for my new home, so I am using this as my motivation to keep on track for the couple of years to 2016. I might have to re-evaluate if I've been too ambitious, but we'll see!

April 2014 - £143225
May 2014 - £142,899
June 2014 - £142,574
July 2014 - £141,994 start overpayments £250/month

Short term goal - £117950 by May 2016! eek.

Unfortunately I am off on holiday tomorrow for two weeks, but I'll be trying not to spend all my holiday budget, so I can feed the leftovers into the house pot afterwards. My first challenge!

Worry_Wart

Two over payments of £250 made now. I didn't do so well at not spending lots of money on holiday. Quebec is expensive!

WishIwasstill25

You look like you are chipping away well already, it looks like £500 a month capital as your starting point. And that will only go up as your interest goes down.

Good luck,
Wish

Worry_Wart

Thanks Wish! You seem to be a good few years ahead of me in the MFW game, but we have pretty similar situations at home. I love my northern Victorian terrace too

Worry_Wart

This month I set myself a challenge to reduce my grocery bills. I calculated I spent about £450 last month! My boyfriend would have spent money too, so our grocery bill was huge. We did have a house warming BBQ though, and had a lot of people coming around to see the house and have food (I love to cook), but still, I didn't realise I'd spent so much!

So this month I'm taking it right down to about £150. I've made a meal plan for the next week, and have the clever idea of only making veggie dinners, as it will be much cheaper. Both me and my OH were veggies for a few years when we were younger, so are not averse to this. Also, I work away a lot and my meals are paid for by my company, so I can eat my steak then! If my boyfriend wants meat, he can buy it.
I've got apples, watercress, and courgettes growing well, so can eat as much of those as I like. I'm going to forage for blackberries too.

These are my list of dinners for the week:

pea and bacon cream pasta, apple and blackberry pie
broccoli and stilton soup, sourdough toasts with melted cheese
courgette and rice filo pie
new potato and cabbage curry
carrot and cumin fritters, salad
frittata using leftover veg

lunches will be leftovers. I can't believe I've never meal planned before. This should save us a fortune!

I'm also going to swap my usual glass of wine or two for a g&t - much cheaper. Or go for a run and skip the booze - better still!

Worry_Wart

Obviously the bacon is not veggie, but I have a pack that needs using up. I think there are also lots of prawns in the freezer so will be incorporating those too next week, no doubt.

WishIwasstill25

Meal planning is just fab,

£450 for two is high though, where do you shop? I'm a complete Ald1 convert, but it only works for me because there is a mainstream supermarket next door where I can get the rest from.

Worry_Wart

er, mostly at the local farm shop! it is really nice stuff, but pricey. I also have two big beasts of cats who will only eat the really expensive cat food, so about 80/month goes on them.

There is an Aldi not far away and I do go there for every now and again, but should go more often for tins and basic items.

I was buying quite a lot of fish because I love it, but it's just so expensive.

I think 3-4 bottles of wine @ £7 bottle is about £100/month, so need to knock that on the head too.

Coffee_Cup

Aldi and Lidl are great for so much stuff these days I could save a fortune BUT then I walk up the housey type aisle and buy things I didnt even know I needed so it is a double edged sword for me

Your food budget does sound excessive so perhaps that is where you could make some good savings.

Worry_Wart

Yeah I think we just went a bit crazy for a few months, as in the run up to getting the mortgage earlier this year we were living on beans and toast! I've not had beans on toast for six months now - time to revisit that meal I think

Lifes_Grand_Plan

Hi Worry_Wart,

A little tip for you that you might consider. You don't mention what your regular payments are, but if for example the regular payment is £750 a month and the overpayment is £250 per month, don't think of them as a regular payment and an overpayment, just think of the whole £1000 as your payment, full stop. Perhaps its just me, but if I get out of the mindset of the extra £250 being an overpayment, then it becomes less 'optional' if that makes sense.... so you're less likely to be tempted to cancel the overpayment when you need a holiday or new car etc.

When I first took my first mortgage the payment was something like £700 per month but I mediately started paying £1000 per month. Then when my fixed rate ended my "regular" payment dropped to £400 per month but I still maintained my £1000 per month payments.... so its just always been £1000 per month to me and nothing else.

One other question - you are on a fixed rate - is there a maximum overpayment you can make without incurring a charge? Just be careful not to exceed the maximum if there is one.

Well done on joining the MFW club though, i'm 8 years into my first mortgage now and have 5 years left on it I doubt i'll be in my current house in 5 years to actually pay it off, but at least I have built up 50% equity on my current house which will be a nice deposit against the next one.