Mortgage free in Forever Home :-)

KajiKita

I have not been well since Monday, fighting a water infection. Last night I finally had to admit defeat and rang 111. That led to a late night trip driving myself out to an @sda pharmacy. I finally slept last night for the first time in a week - a good nine hours (I didn’t bother setting my alarm this morning and just allowed myself to wake naturally). I’m feeling quite a lot better - much less pain but so tired and so fragile - not like me at all. Not managed to do much today, which is frustrating as there are so many plants in pots that need to get in the ground but hey, I’ve done my washing, washed and changed the filter jug, fed Mr KK very simply for lunch and washed up and I am still vertical. That’s a win, right? 😉

Had an interesting conversation at lunchtime with Mr KK about an article he had seen on TV about mortgage rates and where they might go over the next 12 months. He’s getting quite worried, not unreasonably, and we had a conversation about possible tactics / approaches. I emailed our mortgage broker in the week (we always use him as we trust him, it doesn’t cost us anything and we are in a complex situation with Mr KK being both older and self employed). The broker’s suggestion is that we start looking at possibilities in May next year (our current deal ends in October), possibly get accepted for a deal (ones where the offer lasts for six months or so) then and then keep looking for better rated deals until October and we have to settle on the one deal. I can see the logic of this. 

Mr KK was wondering about going for a new fixed rate deal now whilst rates are relatively low compared to where we might end up this time next year. This doesn’t make sense to me as we would have to pay a penalty for leaving our current deal early, definitely pay higher rates from now (we are currently on 2.17%) for at least 12 months and whilst the volatility of the mortgage market means it is almost unknowable what rates will be available in 12 months time, the rate of our current deal *is* known. 

I suggested that interest rates probably should be running at 6 to 7% in ‘normal’ times (a guess on my part tbh) so if we are looking at double digit interest rates when we come to remortgaging next year we should go on a variable rate deal so we don’t get stuck in a higher rate deal. 

Does all this make sense?

In other news, we have a huge hole in our living room floor where the foundations for the new fireplace are being constructed! Squeee ….. 😊❤️

KK 

Crazycatlady2

It’s hard to know what to do I’d say but all I can suggest is squirrelling away some money into savings to either pay a lump sum when deal ends or overpay or use saved money to help ease things after the October when rates might be higher 🤷‍♀️ I guess it’s different for everyone which is why it’s so hard to know what to do really 

KajiKita

Crazycatlady2 said:

It’s hard to know what to do I’d say but all I can suggest is squirrelling away some money into savings to either pay a lump sum when deal ends or overpay or use saved money to help ease things after the October when rates might be higher 🤷‍♀️ I guess it’s different for everyone which is why it’s so hard to know what to do really 

Thanks for the reply. I am squirrelling - well actually a balance between that and OPing, mainly so we can pay any arrangement fees without having to add to the mortgage balance. But I have said to Mr KK that we will have to see where we are by spring next year, before we decide to action our idea of putting slabs around the house and on the new deck (c. £2.5 to £3K spend). 

KK

Baileys_Babe

It makes sense to me @KajiKita
1) Keep your current deal until it ends, October 2024
2) In May start looking for a deal and apply for a deal with a six month offer
3) Keep looking at possible mortgage deals in case something better comes along.

If you are in a position to I would overpay as much as you can afford while the rate is low. If you fill this year's overpayment allowance save and pay it off the mortgage when your next mortgage year starts, if you fill that year's allowance, continue saving and pay a lump sum off before the new deal starts. Any overpayments plus your monthly payments will mean you need to borrow less come October 2024.

Have you played around with the mortgage calculator on the main site? You could input the figure you will owe in Oct 24 (with no overpayments) and see how much your monthly payments would be at various interest rates. Could you then do a budget with a higher monthly payment and use the extra for overpayments? This would also get you both accustomed to the higher payments.

Obviously, I have no idea if this approach would work for both of you or it might lead to one of you becoming overly anxious.

KajiKita

Thanks for the feedback @Baileys_Babe 😊

We are OPing where / when we can. I am aiming to get us down to at least £250K by the end of this year and then start eating well into the next £10K before we get to May. 

I have done a projection on rates going up to 6% today and we could afford that, at current contributions to joint accounts / less than standard monthly contribution to savings, but beyond that I think we would start to squeak. I should repeat the exercise, at not today’s but hopefully next May’s balance and see how the figures come out at 6%, 8% and 10%. Not sure if I could persuade Mr KK to contribute more to joint coffers before we have to though! 😉 But I could try it. 

KK

KajiKita

Cut flowers from my garden yesterday, they won’t last as long as shop bought flowers but I am really pleased with them 😊
I have recorded them as worth £3 on my produce tracker as that is the cheapest you can buy shop bought flowers for. I thought I had posted this earlier but it doesn’t seem to have made it onto the forum …. Will wait and see if this posts …

skint_spice

Lovely flowers!  I tend to go for similar colours to those.

KajiKita

skint_spice said:

Lovely flowers!  I tend to go for similar colours to those.

Thank you 😊 
I discovered this spring that I seem to have a bit of a thing for purple and yellow too, everywhere I looked I had planted purple and yellow flowers - quite unintentionally 😊

KK

Tescodealqueen

Such a pretty display x

redofromstart

Very pretty, and how lovely to cut from the garden