Benefits to being mortgage free?

My wife got a mortgage for £62000 3 years ago. The value of our house was £82k (not likely to change at the moment either).

I moved in and we got married and although the mortgage isn't in my name (yet) we have been talking about aiming to be mortgage free or buying a new house.

We could clear our mortgage in 10 years which would be a dream but only want to do that if there is benefit in it.

I can't see, apart from never having to pay a mortgage again what benefit we would get from this. We have no children, nor want to, but it does beg the question of why it would be great? I suppose, if we lost our jobs we wouldn't lose our home but I want to know from your experience or from your journey why you're doing it?

Cheers!

L x

Replies

  • edited 24 July 2017 at 8:59AM
    bexster1975bexster1975 Forumite
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    edited 24 July 2017 at 8:59AM
    Hello!

    Great question. There is no point if you don't know your reason for doing it!

    I am MF. It took about 12 years start to finish. Mortgage was a bit more than your wife's, and I cleared it alone. I started because the saving over the lifetime of the mortgage, even a relatively small mortgage at quite low interest rates ( I started at 5.5% and reduced the rate at each point throughout the mortgage) is huge. It also offered me the chance to take a payment break if I had needed to due to job loss/ illness. I then decided to use my pay rises to pay off the mortgage as I had a comfortable living standard from quite early on, so why spend money if you don't need to? In the event this was all quite smart. I became quite ill about three years ago now, and spent almost a year not working. Luckily I had a very good sickness benefit from my job so for most of that time I did not lose money. I wasn't sure however for quite some time whether I would be able to work again, either at all or part time. Having a very small mortgage, and savings enough to cover it at the time if needed, made a huge difference to the level of worry. I am much better now and working thanks to treatment that is ongoing. I know this isn't the most cheerful way to look at things, but if the worst happens it's nice to have a bit less to worry about. As it is I have paid off my mortgage, and can do what I like with my time/money which is a gift I wouldn't swap.

    It all depends on your point of view I suppose. I will read the replies you get with interest.

    Bexster :)
  • wishingthemortgaheawaywishingthemortgaheaway Forumite
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    Reasons to pay it off:
    It save you money (play around with the mse overpayment calculator and see what difference even a small over payment makes)

    All the reasons outlined above

    I actually find it good fun: little me against the big nasty bank, taking money off them that they thought was a sure thing.

    Reasons not to do it:

    You would have less money to spend on the things you want to buy now.

    Personally I don't see why you wouldn't over pay if you can afford to, it's the degree of sacrifice you are prepared to make that determines how quickly it goes & how much interest you save.
    Outstanding mortgage: £23,181 (December 19)
    MFW 2020 Challenge Member #10 0/£2318
  • KittenkirstKittenkirst Forumite
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    We're overpaying now so that we can be mortgage free at a younger age therefore allowing longer to stash funds for retirement and potentially reduce hours/change jobs if we want. It's also for the security of not losing our home should the worst happen :)
    First 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!!!!!!
  • dark^knightdark^knight Forumite
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    Great question for this forum :)

    Everyone has different reasons/circumstances, but these are our reasons for striving to be mortgage free asap...
    1, Not having to pay interest, and related to that not having to worry about the interest rate going up.
    2, Being able to save more for retirement, and to ultimately retire earlier
    3, Have a better standard of living, e.g. better holidays, better cars etc
    4, Being able to support our children, e.g. with university fees
    5, Not being tied to a job due to the mortgage commitments
    6, Being able to invest more, e.g. investment properties
    7, And most importantly peace of mind :)
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