Getting rid of a London-sized Mortgage

Tropically

Gosh, hopefully not! I am using the price we paid in 2016.

To make timing even worse, we waived half of rent for our tenants for April and May so we won't receive the normal amount. It seemed like the right thing to do. Neither of our jobs are affected and we are currently in our prime earnings        .

Our mortgage will come out soon but in our current account we have £12,701.  I have a side hustle and it will pay £175 on Monday. I get paid 3 months after I do the work, which is so long! I actually have lots of side hustles. I'm a big fan of side hustles and I am a big fan of having separate pots. We do have our EF, but I also have a separate pot. When we bought our current property, I bought at 95% LTV even though I had an extra £30,000 in cash. The interest rate wouldn't change with a different LTV and I only had to pay a minimal fixed transaction fee. I wanted to keep that cash for furniture, repairs etc. and then   make a big OP with the rest. I didn't end up spending it on furniture, or OPing, so it is just sitting as cash because it didn't seem sensible to make a big OP with Covid. I do have that pot I could use but it is in $ and has been earmarked for this mortgage. I could use it in a pinch. 

Optimistically, I am going to reach £15,000 plus remortgage fees without dipping into that pot. 

Right now, I am sitting outside in a screened in patio listening to the sound of tropical rain and the chirping and clucking of birds who are delighted to be bathing in it. A gorgeous green heron just landed on the fence and is preening. There are lizards who are trying to get girlfriends by dancing and puffing out their bright red throats. Good luck, little fellas.  

Savingtomove

You will be fine with a 2016 valuation! I just thought if you were using a early 2020 valuation there maybe a little wiggle room! 

At least you have lots of options so it is just working through the pros and cons of each one.

Your patio sounds amazing!! 

Tropically

I woke up this morning to two side hustle commissions which is fantastic. One is from a different client who pays more quickly but the other I will have to wait three months. I see no reason why today shouldn't be a NSD. The side hustle money hasn't cleared yet but the monthly interest from the Santander account has, so the account is one or 2 £'s up. My husband also got paid today and the plan is to exchange some into pounds at some point. 

Tropically

The side hustle  payment cleared but a Regular Saver was taken out, so actually our balance has gone down to £12,678. I could always raid the regular saver if needed. It has £800 and an interest rate of 2.5%. When it matures, it only yields about £40, which doesn't seem a lot after a whole year of making savings. So should I consider the two together? I won't for now, but maybe?

Tropically

I am not doing well at this! My Spanish class has come out and so I am down to £11,268 however we did the math and found that we can do the £15,000 OP and still have some savings. We are still exploring options with other lenders. 

My husband also bought me a Masterclass subscription. It wanted you to sign up for autorenew and he asked me to put a calendar reminder for one year to cancel. Oh no no no, that's not MSE. We took off the autorenew right away. It made him nervous with all the screens saying, "Are you sure you want to cancel?" "Are you sureeeeee you want to cancel?" Yes of course, why would I want to automatically pay again in a year? If I am still using it then, I will sign up again. 

Tropically

Alright! We did find a different lender, it is a higher interest rate but it is fixed for five years. Interest rates can only go up from here, especially variable rates. They don't require us to make such a huge overpayment, but I still want us to put down some more money on the house so that we don't owe so much overall. 

I don't have much good news to report on the balance as it is still lower than when I first started posting. Some gifts and some shopping have put it a bit lower. I had £800 of side hustle payout so now my total is £11,652. 

We paid a mortgage application fee of £300 so we are starting the process, and that explains why the number is a little lower overall. I still want us to put down a £15,000 overpayment if we can. 

Savingtomove

Well done on keeping a handle on it and working it through.  It just shows you how important it is to be financial stable!
STM x

Tropically

We have been saving furiously over the last couple months, and have made a transfer from my husband's account into GBP. It, in combination with rent from our tenants and some side hustles, has brought our balance up to £21,769. We need to make an OP of about £15,000 sometime soon and then remortgaging fees look like they will add up to £3000 when accounting for everything. We are fixing for five years now. It is amazing how quickly 2 years rolls around. It was nice to have the 2 year fix and then 2 year fix again but we've done the maths and it's worth it to have a slightly higher rate for a longer period of time so that we spread out these fees over the term.

The question now is when is best to make the OP? In terms of savings, now is the best time because we would benefit from a lower balance over the next couple of months. But, I'm also reluctant to lose cash savings until absolutely necessary because of all that is going on. 

We still have the separate emergency fund of £30,000-ish. 

Tropically

Yay, another £300 side hustle paid today. I also got a refund from something I bought on Etsy which couldn't be shipped here. I would have preferred the item but at least it was refunded. Total up to £22,117 but the mortgage payment needs to come out for this month. 

blocpartyfan

Hi Tropically,
So wonderful seeing your posts - I am immensely jealous of your tropical lifestyle and in awe of the efforts you have made to clearing your London mortgage (I feel that pain!).
You're clearly very talented - must be great to have the skills to have a side hustle on top of a breadwinning job. My side hustle has come to a freeze, and unlikely to return, as it's in events.