Here we go! Single Income mfw 27 October 2021 at 9:12PM in Mortgage-free wannabe 18 replies 1K views

laura_louise

Updating for accountability.

So, my car blew up, typically, just as I was getting on board with all these overpayments, which wiped out a good chunk of my savings and hence my ability to overpay. 

On the bright side, I had savings which i used to help purchase another car. Ended up costing more than I thought because second hand prices are so expensive right now. However, i haven't acrued any debt to buy it so i'm more than happy with that. 

I've returned to overpayments but at a lower rate (£250 per month) while I build up my savings again.

Current mortgage balance is £87,796

Starting to get a little worried about my mortgage fix which is due to end in December. I can't renew my fix until August, it seems that I'll be paying more. I ran the figures on their website today and it looks like my payments will rise by around £40 a month, I wonder what this figure will be like in a few months when I actually come to renew . Wish i could just renew now but i can't - I have a feeling it's going to be even higher by August. Sucks. But i can still afford it which is the most important thing right now.

Personally, I have a lot going on right now as I'm in the final year of my degree (studying with Open University part time). This last year is pretty heavy and I'm not earning quite as much in my self employed work as I did previously, but i'm making things work. My daughter also had some health issues although things are looking better now. Between now and September is going to be really full on. 

Over and out. Hope everyone's doing okay these days, things are getting ropey out there.

Sistergold

Weldone for keeping up with your overpayments despite all the cost of living increases. 

With regards to “worried about rate increase” do you overpay and keep monthly payment the same thereby straight away decreasing the term oor do you overpay and reduce monthly payment and thereby keeping term the same for now? I find paying and reducing monthly payments(keeping term the same) has helped me create a cushion for rate increases interms of monthly payments. So far with all rate increases my monthly payment has gone down despite actual interest going up. 

Good luck with your studies. Thank God your child is feeling better. 

savingholmes

Well done on buying a car with cash. Not many do that. Keep going. 

laura_louise

Sistergold said:

Weldone for keeping up with your overpayments despite all the cost of living increases. 

With regards to “worried about rate increase” do you overpay and keep monthly payment the same thereby straight away decreasing the term oor do you overpay and reduce monthly payment and thereby keeping term the same for now? I find paying and reducing monthly payments(keeping term the same) has helped me create a cushion for rate increases interms of monthly payments. So far with all rate increases my monthly payment has gone down despite actual interest going up. 

Good luck with your studies. Thank God your child is feeling better. 

 That's really helpful to know about as a possibility, i might consider this and talk to my lender about it when it comes time to renew in a few months - thanks for sharing that. My payments have been staying the same. I do know that when I renewed my fix last time, they recalculated based on the entire term left, so I imagine that had a similar effect to what you are talking about, although on a different kind of timeframe.  Something more to think about. Many thanks. 

Sistergold

laura_louise said:

Sistergold said:

Weldone for keeping up with your overpayments despite all the cost of living increases. 

With regards to “worried about rate increase” do you overpay and keep monthly payment the same thereby straight away decreasing the term oor do you overpay and reduce monthly payment and thereby keeping term the same for now? I find paying and reducing monthly payments(keeping term the same) has helped me create a cushion for rate increases interms of monthly payments. So far with all rate increases my monthly payment has gone down despite actual interest going up. 

Good luck with your studies. Thank God your child is feeling better. 

 That's really helpful to know about as a possibility, i might consider this and talk to my lender about it when it comes time to renew in a few months - thanks for sharing that. My payments have been staying the same. I do know that when I renewed my fix last time, they recalculated based on the entire term left, so I imagine that had a similar effect to what you are talking about, although on a different kind of timeframe.  Something more to think about. Many thanks. 

Yes what you are describing is what happens with me. If I make payments of up to £999.99 then payments stay the same until they need to recalculate either when product term expires or in the current months if interest rates go up then they need to recalculate so payment then goes down due to overpayments. If I make overpayments of £1000 and more then I am to have a discussion at which point I choose to reduce term and keep payment the same or keep term and payments have to go down. So basically as you have been overpaying when you need to do the next fix ask them to keep term the same and that way your overpayments might mean your monthly payment will 1, go down a lot or a bit 2, go up only a bit, or stay around the same. With time if you continue to OP and keep term the same your payments will only have to go down. So far I don’t reduce term so as to future proof against rate increases. Due to OP, my payments are down from £2202 at start and now I am on £1941 so far I am not worried about the next rate rise as so far in don’t expect it to ever go above the £2200. Future proofing is important for us singles I think as it gives peace of mind. Later you can then just decide to just pay off the mortgage once it’s low enough for you to that way you then just chop off the term as it will be comfortable for you to. 

Cost of living and life is a bit unpredictable at present and every little helps. Good to let payments go down than focus on saving on overall interest paid.

laura_louise

Not been around for a while. Update: I now owe £81,005 on my mortgage. I was quite shocked to compare it to October last year when i first created this topic, I can barely believe i'm down a whole £10k in one year (I owed £91,313.16 a year ago).

Things really ramped up for me when I saw how interest rates were going. My mortgage fix ends in December and ever since April/May i've been panicking about this.

I fixed my new rate as soon as i could and managed to get a 10 year fix at 4.2%. It's completely flexible so if rates come down i can always jump into a cheaper fix. It's still a monumental jump from my current 1.69%. 

So, the economy and rates put a fire up my !!!!!! and I've been paying as much as I could each month, usually around £500 extra. My mortgage will jump from £334 to £420, a big jump but nowhere near as big as it would have been had i not overpaid. It's also good for me to see what is possible, although i think for my own sanity i need to drop the pace a little, it's hurt quite a bit and Christmas is coming. I'll definitely continue to overpay though, it's made a huge difference. 

LeighofMar

Glad you could get a new fixed rate. I think this economy is making everyone scramble to make sure they can weather it and stay financially stable. 

savingholmes

Glad you have managed to get sorted. Well done on all the OPs.