A long slow journey to mortgage freedom

Firegirl

Hi,

I have been reading these threads over the last few days and I'm completely addicted!!

So approx 10 years ago we bought a flat for £83k sold for £115k. Overplayed that by £50 a month. Moved to house in 2007 we bought for 183k and recently sold for £180k in April 2014. The house I'm in now we bought for £295k and that is our final 'Jump'.

To save for our forever home we pretended we were paying the bigger mortgage for 3 years. This allowed us to save up and also then knew we could afford repayments.

Now I want to start chipping away at this mortgage, but enjoy life with my hubby and kids. So I want to do it in ways that don't overtly effect out lifestyle.

This week I posted 11 items on eBay and skipped 2 coffee and cake trips! Might help my waist line to. I brought back a pair of trousers I bought in the sales that I didn't really need. So that's a start.

I have a flex mortgage on an amazing rate for the term of the mortgage so I'm very lucky. Will post details in a mo.

Brallaqueen

Good luck Sque x

Luckyinlife

I just started one for myself to :] great way to get some support and keep a record of stuff :]

Good luck

getmore4less

Original mortgage 250750
Mortgage balance 245316.06
Savings balance offset 59912.09
Rate 0.99 - tracker 0.49 above base life time tracker

Normal payment should be 858.52 per month. We choose to pay 1216 per month

With that rate you should have the savings somewhere else earning more interest than you are paying.

Not sure what calculator you are using but those numbers don't look right.

you can't pay off a £245k mortgage with £204k/£200k, you will be using those savings as well and then the payment/terms look wrong.


£245,316 @ 0.99% over 19 years £1118pm

net after offset.
£185404 @ 0.99% over 19 years £893pm

paying £1216pm 100% offset/paid off in 13y 8m.

Firegirl

I pulled the calculations and figures straight off my online mortgage account so hope they are right!!! I'll check that out!

I know I should have the 60k somewhere else but it's for the security I have it there. I have 40k in 'high end off medium' risk investments savings and investments and don't want any more risk. Also we moved into a new build so we used some of this money. I think by June all the things we need to buy/do will be done and I can think of tying up a bit more of the savings.

Exciting times!!! So determined to get mortgage down.

Firegirl

Good luck lucky in life!!!! We can motivate eachother!!

So I did these calcs in jan just so I'd know what my mortgage balance would need to be to pay off in 20 years or 15 years:

20 years- £234794 is end of 2015 target

15 years- £230684 is end 2015 target

Does this look more like it? I think the graphs on the banks website make various assumptions that change the figures.

Firegirl

Just called the bank and my Mortgage term is 27 years and 2 months. I remember actually I took it out for the max term to have full flexibility encase out circumstances change. So hopefully that's my figures sorted!!!!

Luckyinlife

I really like your target and it seems easily possible in your situation

How do your investments do ? do you ever take money out of them if you make any or anything ?

Firegirl

I've recently transferred my investment and it's now being actively managed and is doing much better than previously. My IFA is down to earth, realistic and very knowledgable! I work in finance and never thought I would trust an IFA!!!

I'm very aware reading other posts that my mortgage is HUGE!!!!

Luckyinlife

I see its all relative to the household income

I know people who own 100k with less than 15k coming in a year so thats massive to them and hard work

getmore4less

If you want to keep the savings and pay down the full debt then one way to do the calcs is to split the loan in two, one part interest free,

eg £245k £185@0.99% £60k @ 0%

to pay that off in 15 years £1108pm + £333=£1441
but because your rate is so low it is not much less than if you just did the full amount at 0.99% £1467.

What savings rate does your current lender have?

The thing is the chances of the rate staying the same for the full term is low so the aim is to have a figure that will do the job and try to manage that.

I think I would work on numbers that don't include the offset and that is a small bonus/safetynet.