Stewby's Second Start.

stewby · 22 March 2019 at 10:35PM

Good evening.

So... I was here a few years ago and everything was a bit messed up (finances and me) so I paid off my credit card and then started looking at the mortgage. Then I gave up as everything was getting a bit much... but I'm back.

So, here it is.... Stewby's Second Start.

So... finances are a lot more stable. OH is now my husband and we share the majority of our finances. We currently have 11 years and 3 months left on our mortgage and we are in the middle of a 5 year fixed rate deal (until 02/06/23 at 2.24%)

Current Mortgage Debt: £80,329.91
Current Monthly Payment: £673.70

Plan is to follow...

new_mortgageeee · 22 March 2019 at 10:51PM

:wave: Welcome back! I look forward to hearing about all your plans

You've got this!

stewby · 22 March 2019 at 10:57PM

So... we currently have two plans but I am not 100% sure which route we are going to take.
We are able to save £250 each and also take £200 from our joint account. This gives us a grand total of £700 a month in savings.
We currently have approximately £10,000 saved at the moment.
Any other monetary gifts or anything is also going towards the mortgage.

Plan One
Due to the 5 year fixed rate deal, we can only overpay 10% of the balance each year.
So basically, we save up however much that is and pay it off each year.
According to the overpayment calculator on here, we would pay off the mortgage 5 years and 5 months earlier and save about £5000. (for the purposes of this, I have classed it as an annual overpayment of £8000).

Plan Two
We continue saving throughout the 5 year fixed rate deal and in June 2023, we pay off the mortgage. We have 50 months until the deal expires.
According to the overpayment calculator on here, we would pay off the mortgage 6 years and 9 months earlier and save about £4000.

Thanks for reading so far and fingers crossed.
:hello:

MatyMoo · 22 March 2019 at 11:33PM

Welcome back

Plan one saves you an extra thousand, would you earn that much in time interest on the savings if you went with plan two?

stewby · 23 March 2019 at 11:03PM

Rightio... Decision made. We are going with plan one. The aim is to pay off 8% of the mortgage each year in order to reduce our mortgage whilst not incurring any fees.
:j

This allows us a little extra wriggle room with our finances so we can still enjoy life.

So... by January 2020, we hope to have paid £6400 off our current mortgage.
We jointly save £500 a month so this makes £6000 in the course of a year.
We need to find an extra £400 which will probably come from the joint current account we have.

Any extra we save will be kept for a rainy day. I love planning things.

P.S: In case anyone is wondering what happened to our savings in the past 3 years, we got married and we have managed to save up for our honeymoon (we go in April). It is very exciting to have something that is completely paid for before we go.