Had a mortgage too long - it's going, going, gone!

Ali-OK

Lil, you're spot on with SE and smaller mortgage - that's a key driver for me to get mine down too and the worry when work is quieter than I'd like, I find it pretty stressful.

Anavand - sounds like you've a good plan there

:rotfl: Working out what to OP is mainly 30 days of procrastination and 1 day of 'just do it' for me. Min OP I base on paying old interest rate. Savings min is a reg saver at £250 and filling current accounts that are higher interest than the mortgage

Also depends on your mortgage product - can you pay as little as you like as often as you wish? Alot on here can, so those small TTs and Bay of E sales etc soon add up. Mine I can't, it's a min £100 (down from £500 since Jan which is good news). Will you have an OP limit too - alot are 10% of year start balance for fixed deals. A few things to look at and help you decide a product.

hiddenshadow

Anavand wrote: »

Do you have a system for overpaying, where you overpay a specific amount or do you just do what you can? I would be interested to know how people balance overpaying against savings. Ali, of course, seems to have that covered!

We've done a few things.

Started off by taking what we were paying in rent, adding £200 on top (as it sounded like a nice amount), and setting that as our regular payment. By default that meant an OP of about £290.

We added to that with various "extra" income for our first 2-year fix (bank interest, sale savings, surveys, bonus money, etc).

As we approached our re-fix I ran the numbers and we decided we could try throwing an entire paycheque as an OP. This is on top of our standard payment (which has an OP built-in). So far we've made the payments 4/5 months this year, this month we're holding off to re-build current accounts that earn more than the mortgage costs.

Math-wise it's best to pay the most possible as early in the month as possible so that the interest you pay is the lowest amount possible. That said, you can set aside money you plan for an OP throughout the month and do it at the end so that you still have the money available throughout the month if you need to claw it back. As Ali said, depending on your mortgage terms you could do little and often, or big lump OPs. It's all about what works for you and your family/finances.

Luckyinlife

Ya im the same Ali even tho i know i could live comftable ish for a year or 2 if income stopped tomorow i still worry and only since iv had DS i feel like this tho before that i was very chilled indeed haha

Anavand wrote: »

Thanks for sharing your story Luckyinlife. I agree with you that there is the temptation to go for the biggest mortgage and that its important to step back and consider the what-ifs. For us we are hoping to get something that will meet our needs and that we won't need to upgrade from but that won't necessarily impress people or be anything amazing (we are not bothered about status etc anyway). It is very true that the bigger the mortgage gets the longer it will take to be mortgage free and we are very much bearing that in mind. Do you have a system for overpaying, where you overpay a specific amount or do you just do what you can? I would be interested to know how people balance overpaying against savings. Ali, of course, seems to have that covered!

What i think is best is to work out how much you need to overpay each year to get the mortgage cleared in a realistic time frame
For example if i want to clear my mortgage in 10 years i need to Overpay a minimum of £300 a month. so i aim to hit this it dont matter if u dont hit it one month but as long as you get the total u need each year.
This you wont know till you have a mortgage tho :]

Watty1

Another self employed who worried which was why I started the overpay in the main. I had an emergency fund but I realised it would only cover just over a year of a high mortgage - lower the mortgage lower the worry factor.
Reflecting now on our house journey I would love the land but a smaller house. 10 years ago I never thought I would say that. Funny how my priorities changed.

hiddenshadow

Watty1 wrote: »

Reflecting now on our house journey I would love the land but a smaller house. 10 years ago I never thought I would say that. Funny how my priorities changed.

I'm reaching a similar conclusion with our house size (garden could be larger ), even though it's only 3 bed. I imagine we may end up with more rooms when we move, but the layout will work better (more accessible friendly, possibly an annexe for MIL to use down the line, etc). I don't regret buying the house we did as I love it and it more than meets our needs, but it's surprising what you think you absolutely must-have that really isn't all that important a few years later.

shangaijimmy

we bought our 4 bed in 2006 with a view to having kids and if i'm honest i didn't expect we'd fill every room before 10yrs of being in! People keep mentioning we need more room but we don't, we just need less stuff! More room, means more junk stashed in cupboards. we make a big effort not to buy storage solutions and instead try to be ruthless with not hoarding stuff - although i have to acknowledge Mrs SJ struggles with this!! I look at Mrs SJ parents house and its rammed with stuff, broken stuff, stuff not used for years. They're getting on a bit now too and i dread the day that we have to start emptying it!!!!!

Ali-OK

hiddenshadow wrote: »

I'm reaching a similar conclusion with our house size (garden could be larger ), even though it's only 3 bed. I imagine we may end up with more rooms when we move, but the layout will work better (more accessible friendly, possibly an annexe for MIL to use down the line, etc). I don't regret buying the house we did as I love it and it more than meets our needs, but it's surprising what you think you absolutely must-have that really isn't all that important a few years later.

And also what wasn't essential and a nice-to-have, but realise is essential years later..downstairs loo :rotfl:

Great discussion and insight

hiddenshadow

Ali-OK wrote: »

And also what wasn't essential and a nice-to-have, but realise is essential years later..downstairs loo :rotfl:

Yes! We've been without one for a few months as we're (very slowly) refurbishing it, and those days when you really really need the toilet...going up 2 flights of stairs is torture! :rotfl:

Ali-OK

2 flights, Hidden :eek: No wonder you like to keep fit!

Architect has sent corrected drawings so job for the weekend is to finally work out the internal layout.

Accountant has sent through tax return figures, new chap (old one retired and sold out) is suggesting I overpay tax/ni in July, when I also overpaid in Jan. Cheeky! Need to speak to him tomorrow or Friday to sort out.

Otherwise, all quiet except usual financials:

- Bank accounts checked
- FPL and LP checked
- Inbox £s at £7.23
- Qmee up at 88p

Started off pencilling in a £970 capital payment for June, but have revised that down to £900 - not saved much this month and work has been a little quieter than expected - though like buses, alot of activity has come at once and I suspect I'll be working during the Whitsun week (which I was hoping to have off).

Quite a few things to sort for Mum too - her cleaner has had to retire due to ill health, her mobile hairdresser has moved out of the area and her washing machine broke down. 2 out of 3 sorted, 1 in progress. Few probs with her condition too, but stabilising ok.

DS has been super-domesticated of late (yes, he was after something :rotfl:) and it's been lovely not to [STRIKE]nag[/STRIKE] ask nicely more than once

Got to start on the June birthdays soon too - first one is on the 2nd and another 3 family ones that need gifts or vouchers. Probably Sunday when it's free parking in town.

That's all for now, hope everyone's week is going to plan

in_need_of_direction

As always, I'm in awe of your organisation