Elf vs The Mortgage!

Hi All,

As I've just made my first ever mortgage overpayment I thought I would mark the start of the journey by joining this board! :j



Bought my flat in July 2012 - it's only 40% of a Shared Ownership, which I know lots of people here don't like! But it was all we could get at the time, and despite what everyone says, it's working really well for us - although I know it will be hard to sell!

Living in London, mortgage was £82,000, remortgaged after about 2yrs of 'fix' with HSBC to Nationwide, for another 2 yr fix. So far I'm liking NW! (Hated HSBC, but only realised that too far down the buying route to back out then!) So currently have around £67,000 left to pay on a 20yr mortgage.

My OH pays all the bills, and I pay the mortgage/rent/service charges on the flat. We're quite lucky in that his work pays ALL his travel costs, and I cycle to my work, so we save a lot of money on travel compared to some people. Recently I've had a pay rise, and loads of overtime (too much, really! But I'm paid by the minute, so can't complain.) so decided we should make a concerted effort to ditch the debt and be MFWs!

So:

Wages: c. £30,000 for me. c. £24,000 for him.
Current monthly mortgage payment: £373.45
Rate: 2.89%
Rent:£482.30 (it's a 'proper' SO scheme, rent rises/service charges strictly controlled.)

Trying to overpay £500 per month - but I don't mind if we only manage that for 10 months of the year, every little helps! The overpayment calculator tells me we could be MF in 7 years if we did manage £500 a month...amazing!

We live pretty frugally, but I'm not wanting to make us miserable by scrimping so much it hurts ;)

So there we are. Our aim is to get as much equity as possible before buying a bigger flat, basically. London prices being as they are, it's all a bit terrifying. :(

Looking forward to sharing the MFW journey with you all.

Elf
Mortgage - £[STRIKE]68,000 may 2014[/STRIKE] 45,680.
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Replies

  • clynduclyndu Forumite
    570 Posts
    Part of the Furniture 500 Posts Name Dropper
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    Well done. May it be the first of many:)
  • ElfbertElfbert Forumite
    576 Posts
    Yay! First overpayment knocked off the mortgage account!

    Made a knob of myself by looking at the bank acct it had come out of (on the 1st) then looking at the mortgage acct and seeing the only payment on the 1st was my usual monthly amount...so emailing the bank asking where the extra was...

    Then noticed the extra had just been tagged onto the August amount :o

    I wonder how they'll tactfully answer that email without telling me I'm stupid!
    Mortgage - £[STRIKE]68,000 may 2014[/STRIKE] 45,680.
  • ElfbertElfbert Forumite
    576 Posts
    Second payment done, and one of those TSB 5% accounts opened - well, one for me, one for t'other half :)

    It's quite addicting, paying money off, then sticking it through the mortgage calculator and seeing that paying £500 off now saves you loads of future interest :)
    Mortgage - £[STRIKE]68,000 may 2014[/STRIKE] 45,680.
  • gallygirlgallygirl Forumite
    17.2K Posts
    Part of the Furniture 10,000 Posts Name Dropper Mortgage-free Glee!
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    You're right - very addictive but so much more profitable than gambling :D.

    I don't know the ins and outs of shared ownership but with a low mortgage rate (:T) and fairly high rent I'm wondering if you might be better off saving up to buy another chunk? Is there a minimum amount you'd have to buy and what costs are involved - presumably a valuation at the very least?
    A positive attitude may not solve all your problems, but it will annoy enough people to make it worth the effort
    :) Mortgage Balance = £0 :)
    "Do what others won't early in life so you can do what others can't later in life"
  • ElfbertElfbert Forumite
    576 Posts
    We did think about buying more, but it's only a 1 bedroom flat, and we're looking to move somewhere a bit bigger in the next few years.

    I fear that if we buy more of the flat, it becomes harder and harder for low-income first time buyers (as we were) to raise the deposit and get a mortgage to buy our flat. So we've decided we won't buy any more of it now, and if we really struggle to sell it when the time comes, we might do a transaction all at once where we buy 100% of it and then sell 100% of it to a buyer...but I'd like to think it won't come to that, because I'd rather it remain 'affordable' for another young couple to get a foot on the ladder, tbh.

    We actually only bought because buying was so much cheaper than renting in this area! One bed flats in this building rent for around £1100-1200 per month.
    Mortgage - £[STRIKE]68,000 may 2014[/STRIKE] 45,680.
  • edinburgheredinburgher Forumite
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    I think you're probably right about not 'staircasing' (I think that's the phrase for buying a bigger chunk of a SO property), but for a reason other than the one you state. Rather than you owning a bigger share making it difficult for low income people, I suspect that it would simply be a bigger faff to sell. From an objective perspective, I'd rather buy all of a property, or the smallest chunk required.

    I don't think anybody here has anything against SO properties, strikes me as one of the few ways to buy in London. Does the property owner/developer split maintenance costs, or is that all on you and your fellow owners?
  • ElfbertElfbert Forumite
    576 Posts
    Staircasing is the right term, yup.

    Maybe people on this board don't, but over on the buying/selling boards some people are fiercely anti-SO! But you're right, so hard to get a foot on the ladder here in London otherwise.

    The owner of the building doesn't generally split the maintenance, but we're a fairly pro-active bunch living here, and on a recent large bit of maintenance they've stumped up 50% voluntarily, and that may go up... so not too hideous! We also have a healthy sink fund etc. to fall back on.
    Mortgage - £[STRIKE]68,000 may 2014[/STRIKE] 45,680.
  • ElfbertElfbert Forumite
    576 Posts
    eeee, another £500 off the old mortgage!

    And had my Dad to stay, moaning we only have one bathroom - definitely want 2 in the next place!! :)
    Mortgage - £[STRIKE]68,000 may 2014[/STRIKE] 45,680.
  • edinburgheredinburgher Forumite
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    Am I right in thinking you have no children? If so, it strikes me that your Dad had a real first world problem, we coped ok with 7 people and 1 bathroom for 13-14 years :rotfl:
  • ElfbertElfbert Forumite
    576 Posts
    Yeah, no kids! Just me and my partner.

    He's just too used to his own house - and not used to being the last in the queue as me and my partner were both heading out to work!

    I can't be too mean to him - he has an illness that does make his needs slightly more...er...urgent!

    He survived though, and didn't moan too much - he was getting a free board and lodgings, after all ;)
    Mortgage - £[STRIKE]68,000 may 2014[/STRIKE] 45,680.
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