Can i join your club???

dano17439

Hi folks

Have been a MFW for a couple of years now, but thought I would post up to tell my story

Me and my wife are both 39, we bought our first property in 1999 - a new build. How easy was it back then???? The builder paid our deposit and a bit towards our legal fees. Think it cost us about £1,000 to move in!

Fast forward to early 2005, we was expecting our daughter so decided to move. We sold our flat with a nice 50k profit which was used as a deposit for our current house. We reverted back to a 25 year term and doubled our monthly mortgage payments

After the initial 2 years were up, we remortgaged to a tracker as I had a feeling the BOE base rate would fall and I was proved right. We've been on a BOE + 0.89% ever since.

In the early days we never overpaid but managed to spend our monthly mortgage savings on house decorating (new kitchen, new bathroom, and redecorated all other rooms). We also got married which we paid for ourselves and newmerous cars bought and sold (all paid for) etc etc.

It was only until a few years back we decided to overpay, a little at first, maybe £100 per month or so and have gradually increased it over the years.

Today I have just altered our overpayment amount so we are in effect paying double what our contracted monthly payment should be. My mortgage calculator say we will be MF in 6 years and 11 months if we keep on what we are doing.

Obviously the BOE rate will increase steadily over the next couple of years but hopefully we will be able to find the extra a month from pay increases etc to compensate the extra interest.

I would love to be MF by the time I am 45. Keep your fingers crossed for us!

in_need_of_direction

All the best, be sure and keep us posted.

egoode

Sounds like you are doing well. Good luck and hope you reach your target of MF by 45. I'm hoping I could do the same by 45 but realistically it will be closer to 50.

dano17439

So looks like I can increase my overpayment yet again. Just had my utility bill through and am £400+ in credit. So I have the choice of getting a lump sum refund or adjusting my monthly payment from £112pm down to £41pm so ive choosen that option therefore freeing up £71pm to go towards my mortgage!

dano17439

Just increased our over payment again as I am changing my work journey and will save a little bit each month so instead of squirreling it away I bumped up the DD. We are now over paying by 113%

The balance on our mortgage is currently around 115k. Our aim by the end of the year is to get it below 100k. Mortgage calculator says 6 years and 2 months to go, instead of the 15 years and 5 months left if we didn't overpay anything

dano17439

6 years to go if we carry on what we are doing. As said in the OP the aim is to be MF by 45. That's in 5 years and 5 months time. My wife is due a pay increase next month so whatever she gets will go towards increasing the monthly overpayment

We also have an interest free credit agreement coming to an end shortly. I would love to whack that payment onto the mortgage aswell (£77 per month). been paying it for a while and I just think we would fritter it away if I don't put it to good use

Current mortgage balance is £112,655. Our short term aim is to get it below 100k before Christmas! That would be a good milestone I think

mrskingandthescarecrow

Hi Dano, subscribing to your thread for inspiration!


Well done on the overpayments. I'm debt busting currently but planning to start on our mortgage in Jan 16.


Good luck on you journey.

dano17439

Little update here, as said I had an interest free DD payment for a piece of jewellery ended which was £77 per month. Also my wife received the good news that her salary has increased by £3,000 a year


So today I have increased our mortgage payment to £1,845 per month. Our contracted payment is £762 so am well please with the amount we can over pay


A quick play with the mortgage calculator spreadsheet predicts a MF date of July 2020, down from March 2021 before the new increase


I can't wait until a couple of months when we will below 5 years. That's a great milestone!

dano17439

More money to throw at the mortgage, at the weekend my daughter decided that she no longer wants to be part of her swimming club as she doesn't enjoy as much and wants to try new things. Its a shame as she was doing really well for her age group. Although me and my wife a slightly disappointed at her decision, we've always said that we try not to be pushy parents and now our daughter is 10 she can make her own decisions

The thing is thought its going to save us £33 a month that we've been paying for her membership so that's going onto our monthly repayment, therefore the new payment to come out on 1st June will be £1,878 per month

It will also mean the milestone of 5 years to go if everything carries on as it is!

I'm starting to see the light, when I was younger I bought a car on a 5 year finance plan so we're getting into the short term liability stage!

Next thing to look forward to is September when I get a pay increase. Its usually around 2% which will mean about an extra £45 per month in my take home pay, so am planning to use this to up the payment again

dano17439

Hi again

No more increase in overpayments since I last posted in May, but in light of the Gov'ners informal hint the other week we find ourselves in a bit of a dilemma.

Basically we currently have the perfect mortgage for us

0.89% tracker above base rate
No ERC's or maximum overpayment limit
LTV of currently approx. 37%
14 years left to pay, but with our current overpayments it calculates at approx. 4 years and 9 months

So we are thinking about swapping our mortgage for a fixed rate. We only need the BR to increase by 0.25% and I feel we wont be on the best rate. Although you can get rates of 1% fixed, these attract huge set up fees of north of £2,000. If we had a larger balance then it wouldn't bother me as much, but beings we have just over 100k to pay back i'm looking for mortgages with zero, or minimal fees. We're looking to be MF within 5 years maximum

I have found the following so far

2 year fix at 1.65% - £30 fee
3 year fix at 2.09% - £220 fee
5 year fix at 2.39% - £220 fee

Or I don't know whether just to keep the existing deal we have and swallow any rate increases that come along, safe in the knowledge that we've been paying 1.39% since 2008 anyway so over the whole term of the mortgage we've had a good deal anyway? Even if the rate increases by a couple of percent in the next few years we'll be so close to paying off our balance that I don't think the extra interest will have much effect anyway. Its really just the next couple of years im worried about

Also by committing to a new provider we wont have that cushion of stopping the overpayment if we needed to.

Anybody offer some constructive advice?

Thanks

Khrisjun

Hi Dano,

When your looking at these fixed deals make sure to include all fees (Not just the arrangement fee) but any exit / deeds release fee from your current mortgage and any solicitors fee you might need to pay if the new mortgage does not include free legals..

For the £30 fee of the 2 year fix if you dont have any additional fees to pay for legals then i would look to that but try to time the switch for 2/3/4 months from now before the BR is likely to rise (Although that timing is ofcourse finger in the air for many)

I would make sure to go with a provider that allows overpayments and perhaps not taking the mortgage out over 5 years but 8/9/10 so that the 'mandatory' payments are a reasonable level.

Good luck with your decision!