WHY do you want to be Mortgage Free?

leonfocus

It might sound like a silly question to most you. Being mortgage free means you have freedom and no more monthly repayments. However, a lot of people seem to think it is the end of all payments. You'll still have to pay monthly payments for council tax, house insurance, tv licence, life insurance, utility bills, mobile phone bills, car insurance etc etc.

Instead of overpaying the mortgage, why don't MFWs look to invest the additional money, such as into a S&S ISA for example?

It is just so one can brag of being MF and having the peace of money that the house is paid off?

There is no right or wrong. I guess I am playing devil's advocate to stir up an interesting discussion

DavidT67

Your monthly household bills, don't accrue interest, so that's not relevant. Best to focus on any loans you may have with high interest rates.

Up until last month my mortgage rate was less than my banks current account interest rate, they are now equal, so no incentive to overpay. Also no other loans or debts to worry about.

Assuming your ISA investments are returning more after tax and expenses than your mortgage costs ,(which mine certainly are), then yes again no real incentive to overpay the mortgage.

Also, currently have enough liquid assets to pay off at anytime should interest rates rise significantly.

So definitely a vote here for investment vs. mortgage overpayment.

bexster1975

Hi

I paid off my mortgage so I had choices. I don't need to earn a certain amount to persuade banks to offer me a mortgage deal. I've also gone self-employed, often problematic from a mortgage point of view. The other bills you indicate can mostly be reduced when needed ( CT excepting) especially TV licence ( can get rid of if wanted), car insurance and mobile phone. I have always invested at the sane time as OPing the mortgage, so I didn't see it as an either/or. I will continue with my investment plans, and see where self employed earnings take me from there.

People also often worry about paying off mortgages due to ill health and job instability. These are not always rational fears, but fears nonetheless. I'm not sorry I've paid mine off. Interest rates will only now go one way, and the shambles that is Brexit leaves everyone more uncertain.

Bexster

dano17439

I want to clear our mortgage so my and my wife have a life choice. We both work full time in London. I'd like the choice that if one day I/we had enough of doing the commute/dealing with the stress, that we can get a lower paid job locally to our home and maybe reduce our hours etc to enjoy each other and our daughter, rather than working 11 hour days including travel


2.5 years to go!!!

BookmobileBadGirl

I want to clear my mortgage so I have independence and stability

MerryGoRoundAvoider

Basically so I can have better life choices, mainly work related. So rather than being in a high power, high paying and high stress job that's mostly dull, i can pick a much more interesting job that pays less as I'm not forced into earning a high salary.

Also it's less scary if you randomly get made redundant (not happened to me yet though)

trailingspouse

Our mortgage was initially negotiated so that it would be paid off to coincide with my husband's 70th birthday. He's the oldest of the two of us, and that made sense to us at the time.

We run our own business, and as OH is now 60 we are putting our exit plan into operation - and that, amongst other things, means that we are overpaying the mortgage so that it will be paid off to coincide with his 65th birthday. We were glad of the lower payments that an age 70 finish gave us at the beginning, but now that we can afford to overpay it makes sense to do it.

Sean_K

I think it's just because it's the biggest payment per month so without that, the mortgage being paid off in full , frees up extra cash. That's the main reason I'd want to be mortgage free.

edinburgher

leonfocus wrote: »

However, a lot of people seem to think it is the end of all payments. You'll still have to pay monthly payments for council tax, house insurance, tv licence, life insurance, utility bills, mobile phone bills, car insurance etc etc.

Show me one example, I've never heard of anybody so daft on MFW!

michelle09

For several reasons,


- I detest being indebted to anyone. Until we bought the house I never had been, paid rent in advance, never had a credit card, phone was PAYG, got my degrees fully funded etc. etc. Not feasible for 99% of the population to buy a house in London without debt so we have a mortgage. But I want it gone ASAP so I can relax about finances again.


- We currently pay £10 a day in interest on the mortgage. I have £8k in savings. Tell me something that will outstrip that interest bill and I'll consider it but I seriously doubt there is one that's legal.


- Our mortgage bill is £850, the rest of our bills are in the £300 region, £400 if you include food. Yes, the bills will still be there if we clear the mortgage but that is a really achievable budget. Even if we both lost our jobs we could take in a lodger for £500/month and cover it.

bexster1975

Quite. My monthly essential outgoings are less than £500 a month now. I could rent my spare room for almost that where I live too if I needed/wanted to.

Just relieves the pressure and enables you to leave the rat race if you choose. Not surprising that it is not encouraged by a capitalist society though. What would happen if everyone decided to get off the treadmill as soon as they could? People wouldn't work for idiot bosses, doing whatever unreasonable request they wanted done this week. They wouldn't sell their souls to unethical and immoral bosses fir a pay check all their lives. I've been reading a book that says under 40s are now more than 50% likely to live until 100. Terribly long time to sell your soul for. Life's too short.

Bexster