Seven Year Plan
andy1886
Posts: 256 Forumite
Hello this is my diary to plot the events along the way to what hopefully will become a journey to mortgage free existence . A little bit about me , I have lived in our current property for 16 years and there are 13 years left on our mortgage with a balance of £45 000 . The previous 2 years we have lived debt free other than the mortgage having being in debt to the tune of £19 000 and on a debt management plan for the 7 years before that . These debts accrued through daily life bringing 3 kids up on one income . During the time on the dmp we cut our spending back and were motivated by the balance falling and the debt free date getting ever nearer . Through the dark days , and there were many , the thoughts of what to spend the surplus money on when debt free kept us going but as of now we have found it hard to justify spending on stuff that we think we want but don't need . This means other than a new suite and decorating , and other jobs that needed doing we are reassessing our future .
We have thought of moving to a nicer area but the houses and areas we like would put us in a lot higher but manageable position and we still have 2 kids at home and want to move when the requirements are just the 2 of us so I feel the best way to pass time is to overpay on our mortgage . We currently are on a 5 year fix which finishes next leap year day , just under 3 years away . I think we can afford to overpay £200 a month but don't know how to go about this , whether to set up a standing order or just pay over the counter each month . If we can achieve this we are looking at about 7 years to becoming mortgage free and I would like to use this diary to plot the months in the same way as I used a debt free diary to get through the dmp . I apologise for the long post but wanted to give an introduction before listening to any advice and questions from anybody .
We have thought of moving to a nicer area but the houses and areas we like would put us in a lot higher but manageable position and we still have 2 kids at home and want to move when the requirements are just the 2 of us so I feel the best way to pass time is to overpay on our mortgage . We currently are on a 5 year fix which finishes next leap year day , just under 3 years away . I think we can afford to overpay £200 a month but don't know how to go about this , whether to set up a standing order or just pay over the counter each month . If we can achieve this we are looking at about 7 years to becoming mortgage free and I would like to use this diary to plot the months in the same way as I used a debt free diary to get through the dmp . I apologise for the long post but wanted to give an introduction before listening to any advice and questions from anybody .
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Comments
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Welcome to MFW. Well done in sorting out your debts. Check with your bank how to make overpayments - I just transfer an amount each month manually using mobile banking. Also check how overpayments are treated. Do they reduce your monthly payment or reduce the term. Sometimes when you are on a fix they don't seem to do either until you come off the fix. If I am given the choice I would choose to keep the payments the same and reduce the term.MortgageStart Nov 2012 £310,000
Oct 2022 £143,277.74
Reduction £166,722.26
OriginalEnd Sept 2034 / Current official end Apr 2032 (but I have a cunning plan...)
2022 MFW #78 £10200/£12000
MFiT-6 #28 £21,772 /£750002 -
Hi Andy! I don't have any advice, being new here myself - I've only just got a mortgage and started my own diary a couple of weeks ago, so I'm looking for tips myself too! Just wanted to say welcome2
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Welcome to MFW. Well done in sorting out your debts. Check with your bank how to make overpayments - I just transfer an amount each month manually using mobile banking. Also check how overpayments are treated. Do they reduce your monthly payment or reduce the term. Sometimes when you are on a fix they don't seem to do either until you come off the fix. If I am given the choice I would choose to keep the payments the same and reduce the term.2
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allmannerofthings wrote: »Hi Andy! I don't have any advice, being new here myself - I've only just got a mortgage and started my own diary a couple of weeks ago, so I'm looking for tips myself too! Just wanted to say welcome2
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Welcome to mfw and congratulations on your first OP :T
When I was sending OPs to my last mortgage I just used to transfer the money online, I'm hoping to do the same when our new mortgage comes through too. I had the detail set up as a payee so I could just send bits over straight away without having to wait, I'm more of an online person though and will actively avoid going into town!2 -
Congratulations on your first OPMortgageStart Nov 2012 £310,000
Oct 2022 £143,277.74
Reduction £166,722.26
OriginalEnd Sept 2034 / Current official end Apr 2032 (but I have a cunning plan...)
2022 MFW #78 £10200/£12000
MFiT-6 #28 £21,772 /£750001 -
EatingTheElephant wrote: »Welcome to mfw and congratulations on your first OP :T
When I was sending OPs to my last mortgage I just used to transfer the money online, I'm hoping to do the same when our new mortgage comes through too. I had the detail set up as a payee so I could just send bits over straight away without having to wait, I'm more of an online person though and will actively avoid going into town!2 -
I make overpayments for many years and go into the branch with my paperwork so they can key in the reference number. I adjust the amount I pay in so depending on expenditure that month. I have built up a big overpayment pot which results in less being paid in interest but it does not change my term.
When I my fixed term ends and before going onto another product I change the term at that point rather than go for the smaller payment amount. Currently we are asking for extra borrowung for an extension and think this is only possible due to me make over £20k in overpayments. Good luck2 -
Fantastic work on your first overpayment- £250 is a cracking amountFirst home- Oct’16 until June’21: £170.995- Overpayments made £13,784 (25% extra!).
New forever home- Sep’21 £309,449 @ 2.05%. Plan to clear it before 30 years!!!!!!2 -
Schoolworker wrote: »I make overpayments for many years and go into the branch with my paperwork so they can key in the reference number. I adjust the amount I pay in so depending on expenditure that month. I have built up a big overpayment pot which results in less being paid in interest but it does not change my term.
When I my fixed term ends and before going onto another product I change the term at that point rather than go for the smaller payment amount. Currently we are asking for extra borrowung for an extension and think this is only possible due to me make over £20k in overpayments. Good luck2
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