Our journey to a mortgage free world!

MerryGoRoundAvoider

Hi,
For around 6 months I've been reading this forum and, to be honest I've felt a bit guilty as until now I've been able to massively overpay the mortgage (compared to a lot of the diaries I've read).

However, a mortgage is a long haul, ours is quite expensive, and I see things getting more difficult for a while, rather than easier.

My situation: I'm mid thirties, married with a wife and daughter.

Our mortgage was £206,000 when we bought our house together back in mid 2012.

Our current balance outstanding is around £172,000, we have around £35,000 in savings (I'm fairly paranoid).

We are on a 3 year fixed at 3.99%, which to be honest I'll be glad to jettison! By moving to a 5 year fixed at current rates we should save £2-300 per month. This should happen in may / june.

However, this is counterbalanced by us potentially having another child. Childcare costs are expensive until kids reach school age.

At the moment we live quite frugally - one modest car, I commute by bike (and normally get the train back) so save a bit on commuting but those costs vary depending on weather and how I'm feeling.

In 5 years I'd love to have the mortgage down to £100,000 however life might get in the way.

At the moment I'm overpaying the mortgage by 4-500 per month and it's made a big difference so far.

Anyway, ramble over. We've had an expensive few months (loads of unbudgeted costs, new boiler etc) but looking forward to seeing how many years we can trim off the mortgage!

abouttimetoo

Hi MerryGoRoundAvoider and welcome to the gang


No need to feel embarrassed about your OP's and it's all relative to our different lifestyles and approaches. Also, whilst MFW might be the aim it's not just achieved via OP's so there will be plenty on here sharing their OP's but not perhaps how much they are also putting into savings/investments etc as it's really about Financial Independence etc


Well done on all you've achieved so far, you're certainly right about it being a long haul so you need to enjoy yourself too


Best wishes with your plans and look forward to seeing your thread progress
Regards
ATT

MerryGoRoundAvoider

Well, after saying all that, my wife is pregnant again with (hopefully) our second child. Yay!

... However, we are now staring into the abyss of childcare costs of at their peak £1000/pm, part time. Mortgage repayments (at least the levels we were paying) will have to take a bit of a back seat for a while!

We've just signed up for a First Direct 5 year fixed at 2.28%, and hopefully I'll be able to continue to squirrel a few £100 here or there in.

Given that we have a redemption figure from our existing provider, we are waiting for the move date before continuing any overpayments, as we want the amounts to tally up.

My previous figures were incorrect. Our mortgage outstanding is around £173,500, and the redemption figure is £172,250.

MerryGoRoundAvoider

Just checking if the signature works ...

ourcornercottage

Good news. I've just switched to a hsbc 5 year fix at 2.49 (was cheaper for me when taking fees into account than the lower rate!) and it gives great security. I'm lucky to have mortgage in 2 marts whereby approx 2/3 us fixed and 1/3 is tracker so I can really OP that one.

Hsbc are quite tight on their OP's on their fix of only 20% of the standard repayment so having part tracker suits me.

Have you joined the MFW15 thread? As there is a lovely spreadsheet that's updated with your monthly OP's which I find motivational. I've had a very unexpectedly expensive 2 months and still managed to get a couple of smaller OP's in mainly as I didn't want to have nothing on the spreadsheet!!!

jodles16

Sounds like you have made great headway and that you have set yourselves up well for another littley, congratulations!

Jodles

Mrs_Rachel_Trelfa

Hi MGRA,

Welcome to the mfw gang. As abouttimetoo said we are all different and so have different aims, but the common goal is to save money. Just remember that every penny makes a difference.

I will follow with interest as my husband and I want to try starting a baby at the end of this year or beginning of next year. However the cost of child care makes me worried.

MerryGoRoundAvoider

Thanks for the kind words. We went in for an early (8 week) scan due to a few concerns, but everything is fine so far (touch wood).

Got some good news today - out of the blue we've been given a settlement from our previous council of £2500! (That doesn't happen every day). At the moment I'm aiming to pay this into the mortgage, when the switch is complete..

In terms of kids, I'm sure everyone who has them will agree that you'll find a way to pay for them - if you just thought about it in terms of money you'd never have them! (something I couldn't even contemplate right now with our current 2 year old!).

However, just bear in mind both your time and finances will take a nosedive - if you plan ahead and have a savings cushion it helps. Also, look objectively at all the stuff you need to buy - how much will the new arrival really use the thing you are buying? Some stuff is worth paying decent money for (buggys, car seats etc etc).

MerryGoRoundAvoider

So, new mortgage all approved etc - just waiting for it to now happen (should be end of this month/start of next month).
I have £3-4000 ready to overpay once it moves over (due to windfall previously mentioned).

Pregnancy seems to be going fine touch wood ...

I think I'll continue trying to overpay £500/pm going forward, and ignore the imminent childcare chasm we are about to fall into (and then just rely on savings to get through that). I feel fairly motivated to overpay, however the motivation is less when you don't pay as much interest, however that sort of thinking is a slippery slope!

So, I should blow my 2015 overpayment target out the water if I overpay £4000 next month (which would make the YTD figure £5500). I'll have to mull this over some more though - I might hold some of that money back.

Miss_Moneysaver

Hi,


Congratulations on the baby news!


How many hours will you pay childcare for? Will that £1000 quoted be for 2 children?


My 2 children are 11 and almost 7 now but I have been through those massive fee paying years. My eldest child went to day nursery from 10 months old and I was on maternity leave again when he was about to start school. I started using a local childminder once he was at school and I knew that she would be able to take the youngest to school nursery (very close to her house) once she hit 3 yrs. She has been fantastic! Very flexible (helps as we both work shifts) and she doesn't charge if we don't need her!
We are now paying approx. £100 a month but my eldest starts secondary school this year so we will see what that brings.
Are both of your employers in the childcare voucher scheme? If your wife already claims them make sure she carries on throughout maternity as there is some set up where the employer has to pay them for you. I wasn't aware of this when I was off but you may want to do some research into this. May save you some pennies.
Good luck! Sounds like you are doing fine anyway.

MerryGoRoundAvoider

Hi - that's for 3 days a week, and is a rough estimate (might be a touch under that, but still painful!)

In terms of CCV - yeah, we weren't aware of this last time round, however this time she's going to accrue them during the maternity leave, which should help a bit!

Still trying to get mortgage shifted over - as mentioned above it's all been approved etc, just waiting for solicitors to do stuff. I got a pleasant surprise this week though - it turns out we owe £400 less than I thought we did, which is nice!