New MFWB! 1 July 2020 at 7:29AM in Mortgage-free wannabe 34 replies 1.7K views

Cotswoldfoodie

Hello all, have followed Martin for a few years and recently after some good changes in circumstances clearing other loans decided to target being mortgage free. 
I started my mission in September last year and the mortgage was at £121,500 (opening balance was £147,000 in 2014). Started with a swap to a lower interest rate (2.85 to 1.75) and better OP arrangements. Target to OP by £700 a month. Balance at the moment is around £111,000 - since going into lockdown and everyone being less certain about job security I've been putting the £700 OP a month in savings instead, my plan is as soon as I'm 100% sure (as much as you can be!) my job is "safe" which should be around October for reasons specific to the industry I work in, I'll whack what I've saved up as a massive OP all within what I'm allowed to each year. So my target balance by the 1st Jan is around £99k.
My tactic is just to pretend I don't have the extra money but having standing orders set up to take the £700 a month out! Can't miss it or spend it then.
Overall my projection if my circumstances don't change is to hit mortgage free by the middle of 2025.
Has lockdown changed anyone else's approach to mortgage clearing? 

LeighofMar

Welcome. Sounds like you have a solid plan. 
"Has lockdown changed anyone else's approach to mortgage clearing?"
It probably should, but I would say I'm guilty of frantically doing all I can to put extra on the mortgage instead of being sensible and keeping enough liquid cash during these crazy times   

Cotswoldfoodie

Thank you LeighofMar, I did think about just carrying on overpaying but the OH isn't working due to COVID so wanted a decent amount of contingency fund just in case. We've poured 6 years of sweat into renovating the house and I couldn't bear to lose it lol 

Sistergold

Oh hello there. 

Looks like you have a good plan going! Initially I was all out for overpaying as soon as possible, but now with lockdown I have decided life is way too short, unpredictable and so to be enjoyed! I still am focused on my house but now decided to enjoy my house here and now . So I have now reduced my OPs to a direct debit overpayment of £400 and on top of that I make small OPs here and there when I feel like. I am also making regular savings so as to make a lump sum overpayment once a year if I don’t use the money for another emergency (target of £20k to £30k). Instead of all other monies going to OPs I am now sending the extra money to savings for an extension. 

Basically because of lockdown I have created more savings pots for emergency funds, Lump-sum overpayment and building fund but honestly all this can be used to pay mortgage and living expenses if ever I should need to but if I don’t need the money for emergencies then I will use to extend. Hope I make sense as I am confused even writing that! 

X

newlife2016

Hi there! Just wanted to pop in and say hi! For me personally lockdown has really concentrated my focus to clearing the mortgage.  The feeling of owning my home without a mortgage and having the security that come what may we have our home is immense.  Good luck with your journey! 

ruby_eskimo

For us we started overpaying just before Covid hit.  Luckily we're both in stable jobs so haven't been too affected but I would say I'm definitely prioritising saving over throwing everything at the mortgage.

Hazelnutty

Hello there! I'm similar to @Sistergold I've set up a regular OP and am just adding the odd one-off OPs, mainly through Tilly Tidies (rounding down my current account or budget underspends) and earnings from Prolific (if I ever get any surveys!) Once the work on my new house is done, I'll review the situation and will probably up the regular OP. I'm just being a bit cautious as the situation job-wise is only secure in the next year and, as a single-income household, I want to prioritise safety-net savings for now

Lumiona

Hi, good luck with your MFW. Due to these uncertain times, we have increased our emergency fund from £10k to £15k and now are making our 10% OP for the next few years. My main target is to save the mortgage balance so it can be fully repaid when the fixed rate term is up in 2024. 

Lumiona

The pitiful savings interest rates have clinched it for us.

Cotswoldfoodie

Hello thank you for sharing your thoughts and approaches to things during COVID. Today I made my first OP since March having got confirmation my jobs safe, so paid £5k in, and have another £4400 in a savings account where the interest matures on the 28th Dec so that will go in then. So balance now £104500 and prediction will be closing balance at the end of the year of £98,750. So not far off and have stuck to saving a decent amount every month (around £1300) so in a good position for next year hopefully to start on the regular monthly OPs again. 
Thanks for reading and best of luck to you all. 

LeighofMar

How wonderful to get below 100k to start off the new year. Fantastic going.