Baby steps to mortgage freedom for beanielou.

Eager_Elephant

beanielou wrote: »

Interesting conversation today with BS.
So. They cant yet tell me what payment will be after fix finishes.
But it will go down considerably to what I pay now.
REmaining term is on paper about 3 years.
If I repay early, even though the fix is finished there is an early repayment fee.
I need to weigh this up with the interest I would pay over the three years.
Thoughts?

I cant remember how old you are Beanie but as your income is mainly from benefits which the Government change at whim, would it give you more peace of mind to have no mortgage so if something happens to those benefits you know your house is safe?

Peace of mind is worth more than a bit of interest (unless its £10k!!!)

Pooky

That's naughty of them, they should give you an indication of what rate they'd normally switch people to after a fix finishes.

Is there a minimum balance you can have owing before the early redemption fee kicks in? Let's say you can get the balance down to £250 with a year left to go, the interest will be tiny, you can ask for the lowest possible payment and eek it out. But obviously you need all the info first and to do the sums accordingly.

Depending on the early redemption fee, if I could, I'd probably just go for it for the peace of mind. We are in a similar position with our finances being mainly DHs government based payments, we have a long way to go on our mortgage but the fear of them all going "tits up" is mitigated somewhat by the savings we've managed to scrape together and knowing we have enough equity to sell up and move somewhere cheaper if need be. I know that's not an option for you so I think I'd be working towards the getting it gone early, even if that's not financially sensible because your mental health will suffer if you're constantly worrying about money stopping (mine does constantly and its debilitating).

beanielou

Eager_Elephant wrote: »

I cant remember how old you are Beanie but as your income is mainly from benefits which the Government change at whim, would it give you more peace of mind to have no mortgage so if something happens to those benefits you know your house is safe?

Peace of mind is worth more than a bit of interest (unless its £10k!!!)

Whispers I am edging (this month) to late 50's.
Yes, I think that you are right.
Thanks a lot for your input:):T:A

beanielou

Pooky wrote: »

That's naughty of them, they should give you an indication of what rate they'd normally switch people to after a fix finishes.

Is there a minimum balance you can have owing before the early redemption fee kicks in? Let's say you can get the balance down to £250 with a year left to go, the interest will be tiny, you can ask for the lowest possible payment and eek it out. But obviously you need all the info first and to do the sums accordingly.

Depending on the early redemption fee, if I could, I'd probably just go for it for the peace of mind. We are in a similar position with our finances being mainly DHs government based payments, we have a long way to go on our mortgage but the fear of them all going "tits up" is mitigated somewhat by the savings we've managed to scrape together and knowing we have enough equity to sell up and move somewhere cheaper if need be. I know that's not an option for you so I think I'd be working towards the getting it gone early, even if that's not financially sensible because your mental health will suffer if you're constantly worrying about money stopping (mine does constantly and its debilitating).

No minimum, if I pay off early even by a month I would have to pay the early redemption.
TBH my mental health suffers enough as it is with all the worry & the lack of security because of the uncertainty about income.
You know how it is.
Thanks Pooky for that. :T:A

beanielou

Also to add into the mix is the thought that as I have not yet done the DLA to PIP transfer there is that uncertainty too.
Although I would expect the care to increase there is also a liklihood that I would loose the car.
Someone was saying yesterday that it will be interesting to see what happens with those still to do the transfer as this evolves to Scottish goverment responsibility next summer & they wondered if there would be a big push to transfer those who have still not transferred before then.
Yet something else to worry about.

Karmacat

For the peace of mind, you might pay it down to a couple of hundred pounds then, or a sum that didn't trigger the early repayment charge? Specific information is what's needed to make that decision, as well as knowing whats most important to you emotionally, but potentially you're getting caught in some very big national/international politics ....

katsoocam

beanielou wrote: »

No, I dont have the money stashed.

I guess I meant you can put the money aside as you go, if that makes sense!

in_need_of_direction

You mentioned that you had a loan that you are currently paying, can you make OPs here without penalty or create a pot to clear early? From my time, many years ago, working in benefits, I believe that you are more likely to get even a little help with paying a mortgage rather than a loan so I'd say clearing the loan would increase your security. Hope this makes sense.

beanielou

in_need_of_direction wrote: »

You mentioned that you had a loan that you are currently paying, can you make OPs here without penalty or create a pot to clear early? From my time, many years ago, working in benefits, I believe that you are more likely to get even a little help with paying a mortgage rather than a loan so I'd say clearing the loan would increase your security. Hope this makes sense.

yes, it does make sense.
No help now with paying a mortgage I believe.
It is now a loan to be repaid when you sell the property or die.
I think.

But good idea on the loan.
I had thought of that too.

So I think I may do the following :-
Pay the new emmergency fund (:( ) to the mortgage before the fix is finished as it is not big enough to count as a capital repayment as such. Then pay the new monthly payment to end of the term.This should be a good bit lower than I am currently paying.
Along side of that I will pay the difference in what I was OPing on the mortgage to the pesky loan.
Clear as mud~~not.

& breathe.

Karmacat

And don't forget beanie, a new deal is *really* expensive - the upfront charges add 15% or so to the cost of the loan. That applied to me when my mortgage was £40k or so. I stuck with SVR till I paid it off when I moved here.