Got the dream house - now to pay it off

Maxthebrave

Hello MFWs,

Ive lurked this forum for years and had a diary a long time ago under another name. So much has changed this then so a new username and diary inspired by my daughters favourite book.

Theres me, darling husband, 2 crazy daughters not yet at school and a long suffering, aged cat. There might be some chickens in the future too.

Weve had a horrible couple of years dealing with the deaths of some close family members, bad depression on both our parts and the general chaos of trying to raise young children. The silver lining was a few inheritances that we have put to good use buying our dream home.

We are in the enviable position of having a small mortgage and the same amount that we owe sat in the bank. However, due to a few complications of buying and selling, the bank has made us sign to say we will not repay more than their allowed, penalty free 10% within 3 years as it would class as a bridging loan :mad:

So we've decided to borrow an even larger sum and buy a buy to let.. The rent on the property we have found will match the mortgage repayments and we estimate we will need to contribute around £300 a month to cover costs. If it goes well then we will keep it indefinitely,if it is too much hassle we will sell it after 5 years and hope we don't lose any money on it. We had an offer accepted last week and we are so excited about this new challenge in our lives.

While it sounds like we have it made, our incomings are currently very low and with childcare costs we still manage to go over budget every month. Our dream home needs a lot of renovation still and we have no extra money to buy curtains let alone refit all 3 bathrooms. We bought a big house and big houses cost money to run it seems.

Our main aims are:
Savings for house renovation
Starting our savings. We have £30k emergency fund so now we can start filling some bank accounts
Paying off as much of our 10% yearly mortgage allowance as we can.

All with no spare cash. Wish me luck :rotfl:

Kittenkirst

Best of luck, looking forward to cheering you on & seeing your progress!

How old is your kitty?

Blibble

Happy new diary! Very brave with the BTL - whilst it's something we'd like to do one day the thought scares us senseless & we wouldn't know where to start!

If you fancy postng an SOA, we can see if we can help point you back under budget?

Maxthebrave

Kittenkirst wrote: »

Best of luck, looking forward to cheering you on & seeing your progress!

How old is your kitty?

Thank you. She is 13 roughly. A scatty, daft rescue who I've had for years. Fiercely loyal to only me.

Maxthebrave

Blibble wrote: »

Happy new diary! Very brave with the BTL - whilst it's something we'd like to do one day the thought scares us senseless & we wouldn't know where to start!

If you fancy postng an SOA, we can see if we can help point you back under budget?

Hi Blibble

I will post SOA soon just need the time. We are really struggling even though we have a tiny mortgage and I wonder how most families do it.

It scares me too but I also have dreams of having a little portfolio one day. I tried to buy one back in the early 2000s but my dad talked me out of it saying that house prices were going to crash I've regretted it ever since. That said its tough out there for BTL landlords and the returns are minimal these days unless you really know your stuff.

Not the best first day as was food shop and needed petrol. Since moving to the middle of nowhere our petrol bills are really high. Meals planned for the week and went with a list which I nearly stuck to. Ended up buying lollipops for the girls as they were being so good.

Shopping is also awkward as I find it impossible to get everything we need in one shop. DD2 is allergic to lots so I find that only Sainsburys do her cereal and only Tesco do gluten free garlic bread etc.

I spent:
Greengrocers - £28.25
Sainsburys - £44.29 (but used £20 on Nectar card)
Aldi - £7.07 (popped there on my way home from gym tonight)
Petrol - £50.59

Petrol included a ticket for the Euromillions. I know I shouldn't but I would be the best millionaire :rotfl:

Feels like a big spend day but hopefully wont need anything for the rest of the week.

Maxthebrave

Doing a bank account check and have now set up regular savers on Santander and Nationwide as part of our annual costs savings.

Will need to add these to the money map. Does anyone else have a hand drawn diagram in the front of their finance file to remind them of the journey their money makes each month? Between us we have 5 current accounts and 5 savings accounts doing their bit. DH shows no interest in our finances so if anything ever happens to me i'm hoping this will help him out :rotfl:

Kittenkirst

Love the sound of your money map- Im a total spreadsheet lover so have a master spending s/sheet detailing everything and then separate tabs for key areas e.g mortgage details & overpayment, diagram of house percentage owned to colour each 1%, pension tab, sharesave etc

Awww a rescue cat! :heartpuls My last cat was a rescue cat that adopted me, she was the most gorgeous little kitty, timid with everyone except me. I now have two little brothers just turned one who keep us entertained :heartpuls

Maxthebrave

Kittenkirst wrote: »

Love the sound of your money map- Im a total spreadsheet lover so have a master spending s/sheet detailing everything and then separate tabs for key areas e.g mortgage details & overpayment, diagram of house percentage owned to colour each 1%, pension tab, sharesave etc

Awww a rescue cat! :heartpuls My last cat was a rescue cat that adopted me, she was the most gorgeous little kitty, timid with everyone except me. I now have two little brothers just turned one who keep us entertained :heartpuls

I love the sound of the house diagram and filling in the bricks, How do I do that? Might be interesting to do that now and then once we've extended the mortgage.

Maxthebrave

Not a good day. Was driving around in town for work and suddenly I spotted Mcdonalds and just felt the need. I've never even been to a drive through before. Damn that heady mix of salt, fat and marketing :mad: I don't even know how much I spent

Now waiting at home for DH to arrive so we can have a chat with the mortgage adviser. I have an awful feeling that they will find a reason not to lend and our whole BTL dream will go up in smoke.

Maxthebrave

Ugh. Nearly 2 hours talking to a mortgage adviser only to have it referred due to DH dodgy credit rating. Plus if we do get it its at a higher rate than our current one for no reason other than they can. I hate how much power banks have.

Its looking like our repayments will be almost exactly the same as the BTL should achieve in rent which means we will likely be contributing around £300 a month in management fees, tax and maintenance. In the hope that our income increases this year with me taking on more work and DH getting a promotion I am hoping there will be a little left to overpay as well.

Suddenly feeling very excited :j

Maxthebrave

I think I chose the worst week to start taking this money saving seriously.

Had to drive to the girls nursery to sort some bits out. Its a 20 minute drive away (on husbands commute) so felt like a waste of petrol but ho hum. Then took them shopping in the afternoon for presents. They are at a party every weekend in March plus its DD2s birthday so its an expensive month. Spent £35 although some of that included stocking up on Nakd bars which were on offer and are the girls favourite.

Just realised I forgot a present for nursery worker who is leaving so have sent DH out to find something. Maybe I can just write the whole week off and start again Monday