Katkatmachine’s Adventures to Mortgage Freedom and Life Updates

katkatmachine
katkatmachine Posts: 189
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edited 5 January at 1:39PM in Mortgage-free wannabe

Hi everyone,


I’m a new MFW, we completed last 20th November 2020 on our new build forever home. Just to share, our 2nd (and last) mortgage extension was supposed to end 21st November but we managed to complete just in the nick of time. Hehehe. :smiley:

85% LTV

10% HTB

5% Deposit

23 year term


Our goal is to pay our HTB within 5 years. We are not making any overpayments yet as we want to focus on our HTB first. Im thinking it’s best to settle it first then after that we could make overpayments or probably refinance/remortgage to a lower term with higher payments. Does that make sense? Is our plan logical? I would like to seek advice if this is the best way to go or maybe there are better/other ways to go about this mortgage and HTB thing. I would appreciate any advice/inputs.


Anyhow, we are so happy that we are now homeowners. We really saved and worked hard for this and finally we have a place to call our own. :)


Kind regards,

Kat


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Comments

  • Congratulations on the new home, and good luck with your overpayment journey.
    New to all this!
    Mortgage balance 01/01/21 £181,400. Scheduled repayment date Aug 2036. 
    Target savings to overpay in 2021 £12,000
    Progress to date  £7105/£12,000 
  • caeler
    caeler Posts: 2,605
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    I guess it would depend on the interest rates? 
  • katkatmachine
    katkatmachine Posts: 189
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    edited 27 March 2021 at 11:07PM
    Thank you for the replies. I have decided that I will focus on paying the HTB first before making overpayments to my mortgage. I thought about paying the HTB by adding it to my mortgage but it will increase my LTV and honestly with the increase in the monthly payments and most probably with the interest I know that I will struggle paying it monthly. So the plan is now to focus everything on my HTB! Every penny will be saved for the HTB!!! With my current savings per month, my estimation is I will be able to pay my HTB in four years time with still enough left for emergency fund. Then I will start overpaying the mortgage. The goal is to bring it down to 15-18 years, I will be in my late 40s by then. 

    I have changed the title of this thread and made it as my mortgage diary. I will update this again this year end to see where I am at financially. 

    Thank you. 

    Mortgage freedom here I come! :)


    P.S. I realised that the pronoun I used in this comment was “I” but actually it should be “We”. Even the title is just my username, I totally left my partner out. Wahahahahahaha. Sorry! :D
  • Mid-year Review:

    Age:
    Me: 32
    Partner: 48

    Original mortgage: £276,250
    Mortgage left: £270,763
    Remaining full term: 22 years 6 months

    My partner and I have decided that we will not be making overpayments in our mortgage. We will use the funds instead to increase our pension contributions especially my partner’s. We see ourselves living in our 2-bed house for the next 15-20 years so there’s no hurry for us to increase our equity. We think that we will benefit more if we just add more to our pension. 


    Current savings: £15,000
    Credit card debt: £1,500

    Upcoming expenses:
    Car (July)
    Holiday if Boris permits :D (September)

    Our goal is to save a grand a month however due to the upcoming expenses I’m afraid we will not be able to reach out goal to have at least 20 grand savings by year end. :(

    Regards,
    Kat
  • Cornish_mum
    Cornish_mum Posts: 617
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    Hi Kat,
    We also decided to focus on pensions not OPs, as we want to retire by 60. Hopefully we can pick up OPs again in a few years. Best wishes CM
  • 2021 Year End Review

    Original mortgage: £276,250
    Mortgage left: £266,666
    Remaining full term: 22 years

    Current savings: £19,700
    Credit card debt: £6,000

    We have a shortfall of £300 in our target savings. 
    For the credit card debt, it’s mostly due to the furnitures that we bought for the house. It has been balance transferred to another card so it’s no longer incurring interests. We are paying £250 per month for this, it will be cleared out in two years.

    Thoughts and Reflections:
    It’s been a year in our new build house and we are still over the moon that we are now homeowners. Since we moved here in the UK we’d been flatsharing with a friend, we didn’t have much space for our stuff and also there’s no garden so with the lockdown, wfh, and all, it became really hard for me. 

    I remember my computer at the time was set-up in the dining table in the living room. Even during weekends or outside working hours, I get stressed everytime I see my computer as it reminds me of work so I get anxious all the time. But now, we have a spare room which I converted to an office so I just need to close the door when I finish for the day. No more anxiety since I don’t see my computer anymore. 

    Also, we now have a garden where we can relax during spring-summer seasons. And the happiness of being able to hang and dry your clothes outside!!! It feels so surreal! Hahahaha.

    Regarding the issues on the house, we had a few snags but the developer was quick to sort them out. We also gave them a list of snags that came up after a year, the developer also agreed to fix them. 

    We also had a parking issue with some of our neighbours using our allocated car park but it was sorted out with the wheelie bin (we put our wheelie bin on our spot to assert our ownership lol), then we eventually bought our own car so it’s now resolved.

    Goals for next year:

    Save £1,000 per month
    Find a new job (not super sure yet but we’ll see)

    I’m not really sure if we’ll be able to achieve our target for our savings next year, my parents are planning to visit for a holiday here in the UK. It’ll be their first time in Europe so it’s going to be a grand holiday which I think will be very expensive (they have their own money but still…). 

    That’s it!

    Excited for 2022!

    Thanks,
    Kat
  • savingholmes
    savingholmes Posts: 26,821
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    Good luck on your journey. I too am focusing on pension as a way to mortgage freedom
    Achieve FIRE/Mortgage Neutrality by mid 2030
    1) MFW Nov 21 £201,999 with 237 payments to go - now £184,341 Equity 26.26% (lower post move compensated by EF)
    2) Mortgage neutral by June 2030 AVC £7,613/£127,466 AVC target 5.97%
    3) FI Age 60 annual income target £12,500/30,000 41.66%
    Achievements: CC free since April 22. 1 year EF from Jan 24 & dedicated pot for home improvements
  • katkatmachine
    katkatmachine Posts: 189
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    edited 16 July 2022 at 2:46PM
    2022 Mid Year Review

    Original mortgage: £276,250
    Mortgage left: £261,763
    Remaining full term: 21 years 5 months

    Current savings: £20,000
    Credit card debt: £6,000

    No changes in our savings. Actually we managed to save around £5000 this year but my family came here in the UK for a holiday whilst my partner went back to our home country to visit her family. We also bought some stuff for the house so yeah the money went to these. Hehehe. 

    Upcoming expenses:
    Holiday in Turkey this September
    Permanent Residency Visa application

    Hopefully we’ll still be able to save around £10k these remaining months for 2022 making our savings £30k. I think it’s a bit impossible now since we have a bit of upcoming expenses but no harm in setting a goal right? Set a high amount so that even if we don’t reach it we hope it would still be near that amount. Hehehehe. 

    That’s it!

    Happy summer to everyone! :)

    Thanks,
    Kat
  • Just going to write random things before my year-end review. 

    Won't be able to meet our target savings this year. Just so many expenses: family visted for a month last June whilst my partner went back home to visit hers; permanent residency application; holiday in Turkey; a few shopping here and there.  Probably our total savings will still remain at £20k. 

    The rise in the mortgage rate is scaring me. At the moment, if we are to remortgage, now our monthly payment will climb up to around £1800. That’s £400 increase to what we are paying now. I don't want to complain anymore or even get mad. It is what it is. If it's going to rise then fine. No point in putting more energy and emotions in something I cannot control. We can still afford it anyway (though could have used the extra money for our savings. oh well...).

    HTB. We have a 10% HTB. The whole plan was to pay it after three years in cash without remortgaging but that’s now thrown out of the window because we just can’t. Value of the house has now increased by £50k. I based this amount from our neighbours selling price, we have the same exact house type, same everything so yeah it’s £375k now which means our loan increased by £5k too. We’ll need to have a think again if we’ll just add it to our mortgage when we remortgage next year (which means this will be on top of the £1800 that I calculated with the new mortgage rates. Urggghhhh). OR we can just forget the whole paying the HTB thing. We’re gonna sell the house in 15 years time anyway. Idk. Any thoughts?

    We had a our yearly performance review at work, haven’t talked to my manager yet but in my review doc (idk what you call it) I asked for a 20% increase. Usually they give us 6-8% every year. But this time i asked for 20%. Maybe 20% is still a bit low but it will make my salary around £42k per year, I’m happy to compromise at 15% so it will still be around £40k. It’s just that my previous manager left a year ago, they didn’t hire a new one and just chucked all the work to us, two members of the team that are left, and that’s it. We have more work and we’ve been doing more senior tasks, attending managerial meetings, being treated like a senior also being called one, but it's not reflected in my title nor my salary. I got the courage of finally writing it in my review doc but now I'm having second thoughts if I did the right thing. There's a saying "you will not be given if you don't ask" or something like that but now that I've finally asked for it I'm scared. Next week we"ll be having the review meeting to discuss what we wrote so I feel really anxious. I hope I'll be able to uphold??? (sorry idk the right term) of what I wrote in the review. Anyway, I could always find a new job if they don't give it to me.

    Okay this looks like a bl0OdY essay now. Fingers crossed everything goes well.
  • savingholmes
    savingholmes Posts: 26,821
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    Give it a shot on the payrise. Nothing to lose and lots to gain. Look for evidence that supports your case 
    Achieve FIRE/Mortgage Neutrality by mid 2030
    1) MFW Nov 21 £201,999 with 237 payments to go - now £184,341 Equity 26.26% (lower post move compensated by EF)
    2) Mortgage neutral by June 2030 AVC £7,613/£127,466 AVC target 5.97%
    3) FI Age 60 annual income target £12,500/30,000 41.66%
    Achievements: CC free since April 22. 1 year EF from Jan 24 & dedicated pot for home improvements
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