Getting rid of a London-sized Mortgage

Tropically

Alright, I have made a meal plan based on budget recipes! I am trying to be more vegetarian after making friends with a rabbit. The rabbit had a lot of personality and made me feel guilty about eating other animals. I can't go 100% but this meal plan is all veggie. We are also trying to eat less food because I have put on lots of weight since lockdown.

I have not managed to discuss any automatic direct debits and changing the internet with my husband. I did add up our total OPs since 2016 and it adds up to £29,529. 

Tropically

Martin's Money Makeover: Insurance renewal was going to be £400 but I shopped around and got a new quote for £270. That's £130 saved over the next year thanks to the makeover. 

mark55man

every little helps - plus really watching the food should reduce grocery bills

Tropically

I went through direct debits and standing orders and luckily there were no unknowns. I wanted my husband to cancel Audible but I managed to get him to pause it for 90 days. That's £23.97 saved at least. We also don't want to decrease our internet package. 

I sold some things, it's always great when things sell as soon as you list them.

I still have to do the hard stuff like cancelling bank accounts, and trying to reclaim some prescriptions. 

Tropically

I keep coming to update here but abandoning my posts half way through. 
Our debt is down to £516,726.17. Only £16,726.17 to go before I reach under £500,000. 
This month our net worth didn't go up, unfortunately. Our investments went down a little and my husband was involved in a parking lot collision and he had to pay for repairs out of pocket. Our cat is also going in for surgery on Friday and the estimate we have been given by the vet is £500-£1500 depending on how it goes. The little fluff is so important to me, it is easily worth it. 

One thing that has been helping us greatly is setting up rules for our money. Our rules are:
* When I have more than $30,000 in my emergency fund, I make an OP with any excess to house #2
* My husband transfers any of his savings to his investment account every 3 months

The last rule is when we have more than £10,000 in our joint account for house #1, we are meant to make an OP. I'm debating changing that rule in case of an economic recession. What do you think? Do you think I should build a bigger buffer? Say, OP over £15,000 emergency fund? Or should I make OPs now. How much should I be retaining in cash with the outlook ahead? 

As an update:
Mortgage 1 : £254,322 @3.5%
Account 1: £10,000 right now 
Mortgage 2: £262,458.18 @5.5%
Account 2: £30,000 

mark55man

I would split your objectives - but maybe not 50-50 - its not like you can't change your mind back and OP the extra savings, or - a bit more seriously you can always take cash back out of the house.  If your interest rates were lower I would suggest more towards the EF, but at 5%+ I would suggest you need to keep pushing on with getting that down - so maybe top up the EF a little but not £5K (£250p.a interest difference)

Tropically

Yes, 5.5% is a lot. This scared me and I changed £5,000 from the EF to the mortgage, so the balance might be about £257,000 when it gets posted to the mortgage. 

I also contacted our new mortgage company and asked them how we could make overpayments there. With our last bank, we could only OP more than £500 at once, so it might be something similar here.  

Tropically

The bank is not processing the overpayment. It's been nearly 20 days! Of course they are taking their time because they don't want to lose the interest. After not doing it for so long, they emailed me yesterday asking for a source of funds document. Silly, because the source of funds is my saving account within the same bank.  

Tropically

Okay, another payday has come by and because of the delays in the bank processing the big OP, there has been only a little progress. Total mortgages are £515,772. Our net worth went up nicely, up to £452,163. 

Actually all of our numbers are pretty frustrating!

Net worth - £452,00: Why can't it be £500,000?
Total assets - £967,000: Why can't it be £1 million?
Total mortgages - £515,000: Why can't it be under £500,000?
Something to strive for! 

mark55man

that's the trouble with numbers - there's always a bigger (or lower) one next in line - I think it's helpful to focus on the progress and the direction of travel as much as the absolute numbers