Plan B to being mortgage free

After reading many of the MFW diaries over the last few weeks I felt inspired to give it a go. Worst case scenario I don’t hit the target I’ve set but we’re further ahead than we would have been just making the monthly repayments, right?

At the start of the year we had a plan – clear our £104,675 mortgage (twenty six and a half years left) in three years. This should have been pretty straightforward – DH is self-employed and I work for him doing accounts and admin etc. We get paid the minimum we need to pay our day to day bills but usually get to take dividends of about £30,000 so between these and the monthly payments and some OPs the mortgage should have been cleared with relative ease and only a bit of belt tightening.

Fast forward to now and obviously the world is a very different place. We know we are very fortunate – I’ve been furloughed since March and at home with the kids (I’m looking forward to September!) and work has been plodding along nicely if a little quieter than normal for DH, fingers crossed this will continue.

Once this was cleared we would then look to either move house to our “dream home” or stay in the house we’re currently in until we downsize once the kids have left home.

Now we’re feeling that we should be more cautious and rather than throwing every penny at the mortgage keep something back just in case recession hits hard as essentially we’re a one income family. But at the time still trying to clear it as quickly as possible so we have more security for us as a family.

I’ve joined the July Grocery Challenge as we’re always seem spending a fortune on feeding the five of us. One good thing about lockdown has been less takeaways as everywhere shut – although you wouldn’t be able to tell from my waist line! Hopefully there’ll be some money left at the end of this month to either add to the savings or pay off the mortgage.

This week I increased the £150.00 OP to £151.15 to make the overall payment a nice round £600.

Now I’m off to read more diaries – at least it’s a healthy addiction!


Mortgage Balance June 2020 £102,824.39 Now £90,500.00
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Comments

  • LeighofMar
    LeighofMar Posts: 672
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    Welcome with your new diary. It is very smart to have a Plan B on any major decisions. Well done. And congrats on the great OP.
    Mortgage start date Dec 2015 - $64,655.00
    Mortgage end date Dec 2045 - NOT!!!!
    Mortgage balance  - $4600.00
    Business Savings $43,310/100k
    Hope to be mortgage-free by end of 2023 
  • South_coast
    South_coast Posts: 4,779
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    Welcome and good luck! Would an offset mortgage or aiming for mortgage neutral (savings = mortgage) suit your circumstances better? That way you can still go at things just as intensely, but still have the money available for you to access if you really need it? 
    Mortgage start: £65,495 (March 2016)
    Cleared 🧚‍♀️🧚‍♀️🧚‍♀️!!! In 5 years, 1 month and 29 days
    Total amount repaid: £72,307.03. £1.10 repaid for every £1.00 borrowed

    Finally earning interest instead of paying it!!!
  • Hi @LeighofMar and @South_coast!
    Previously we've been in a take what we can get position with regards to the mortgage but we're due to remortgage in April so I will definitely look at the option of an offset mortgage - it never even occurred to me but could be a really good option thank you South_coast  :)

    Just checked the bank accounts and there's £23 left in our current account till payday on Friday but everything's paid - I'm hoping we can avoid the shops till pay day but the milks not looking like it will last that long. I think I'll try and find some change in the house to preserve that and be able to send it to the savings account.

    Mortgage Balance June 2020 £102,824.39 Now £90,500.00
  • LeighofMar
    LeighofMar Posts: 672
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    "Just checked the bank accounts and there's £23 left in our current account till payday on Friday but everything's paid - I'm hoping we can avoid the shops till pay day but the milks not looking like it will last that long. I think I'll try and find some change in the house to preserve that and be able to send it to the savings account."

    Been there. I'm so glad to know that other people also have change jars for those moments when funds are running low and payday is a few days away. After barely surviving the Great Recession, I always keep a change jar as there were literally times when the money in that jar paid for our groceries when we had nothing else. Now, it's nice to have and build up so I can see it. Although I need a bigger jar but don't want to spend money on something to keep my money in  p if that makes any sense whatsoever. Best wishes to being able to sweep some money into the savings account. 
    Mortgage start date Dec 2015 - $64,655.00
    Mortgage end date Dec 2045 - NOT!!!!
    Mortgage balance  - $4600.00
    Business Savings $43,310/100k
    Hope to be mortgage-free by end of 2023 
  • Although I need a bigger jar but don't want to spend money on something to keep my money in  p if that makes any sense whatsoever. Best wishes to being able to sweep some money into the savings account. 
    @LeighofMar That makes absolute sense! I'd feel like I was wasting money on buying one. Our jar is one that had marshmallows in it that were a gift. I've covered it as well to avoid seeing how much is in there so we don't get tempted to dip into it too often. Other than milk we have plenty in the house so I'm hoping if we do pop to the shops we'll stay strong and not buy any extras - that's our biggest downfall :( 
    Mortgage Balance June 2020 £102,824.39 Now £90,500.00
  • Tahlullah.H
    Tahlullah.H Posts: 1,227
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    edited 24 June 2020 at 8:46PM
    I completely agree about the savings jars.  A few years ago, there was a trend for these beautifully painted pottery saving pots that you broke once they were full.  I couldn't join in the fun because I couldn't bring myself to pay £6 for something I was going to break later down the line.  How tight am I?
    I am another one who will vouch for an offset mortgage.  Not that I have any savings to offset, but I use it as what it is - which is an interest only mortgage.  Pay into in and overpay as you wish, but if you need to, you can draw down as much as you need of your overpayment up to the original amount borrowed.  Fantastically cheap way of borrowing.

    I have £5 until payday and am protecting it with everything I have, but luckily it is payday tomorrow - think it's early!


    What I do not give, you must never take by force.
    Mortgage outstanding - 30/12/22 - £25,900. 31/01/23 - £22,300. 28/02/23 - £20,500. 31/03/23 - £17,500. 30/04/23 - £15,800. 30/05/23 - £13,800. 31/06/23 - £11,300. 31/07/23 - £9,800. 31/08/23 - £8,300. 30/09/23 - £6,000. 31/10/23 - £3,000. 30/11/23 - £1,200. 06/12/23 - £00.00
    God save us everyone, As we burn inside the fire of a thousand suns, For the sins of our hands, The sins of our tongues, The sins of our fathers, The sins of our young.
    Linkin Park
  • LeighofMar
    LeighofMar Posts: 672
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    Ha ha, so glad I'm not the only one Braving and Tahlullah. We are not tight. We are savvy  ;) Somebody's got to have some old canning or mason jars around here that they're not using  :p It looks like we are all getting paid today or tomorrow too. I've ordered the groceries right at my budget, so I have to try to keep OH from going to the store to pick up odds and ends. 
    Mortgage start date Dec 2015 - $64,655.00
    Mortgage end date Dec 2045 - NOT!!!!
    Mortgage balance  - $4600.00
    Business Savings $43,310/100k
    Hope to be mortgage-free by end of 2023 
  • ruby_eskimo
    ruby_eskimo Posts: 4,526
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    Welcome to the mortgage free journey @BravingSaving I agree that its a difficult balance between paying off the mortgage and building some savings.  Hope you manage to strike the right balance.  My savings jar is an old tea canister that my mum was throwing away so think that's quite MSE if I do say so myself :wink:
    Emergency Fund - £7992.62 / £10,000 :: Total Mortgage OP - £34,692
    LISA 24/25 - £0 / £4000 :: NSD 2024 - 13 / 180 :: Moving Fund: £838.83 :: Decluttering - 143 / 365
    Engaged 9th December 2010 :: Married 29th October 2015 :: Bought a House 13th January 2017
  • We are not tight. We are savvy  ;) 
    Absolutely!
    I managed to maintain the £23.91 so that got transferred to savings this morning. DH is currently doing the first shop of the month so I'm excited to update the grocery challenge totals (someone needs to get a life!) 😂
    @Talullah.h did you manage to keep your £5?
    Thanks @ruby_eskimo I've been reading and enjoying your diary 🙂
    Mortgage Balance June 2020 £102,824.39 Now £90,500.00
  • longway2go
    longway2go Posts: 1,006
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    Welcome to plan B, sounds like a good one. I think nearly everyone's plans have changed due to covid. 
    Good luck. 
    Mortgage Aug 2019 161,000 :eek::eek::eek:Nov 2019 156,500:T Jan 2020 153,122:T, Apr 2020 149,500, Apr2021 139, 675, Oct 2021 136,823, Dec 2021 136,120🙂EF 0/12,000 (0%)😕 (5062.44 was ERC), Jan 2023 128,650. Our Mortgage is never going to be as high as it is today. :jOnwards and downwards to a better life for our family. :jJust keep swimming
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