Mortgage free by 2025

Mickyh-s

I have been lurking on MFW for a few years.  I go through phases of being really good at overpaying and then life gets in the way!

There is just me and DH (plus fur baby Franklin) in our household.  I am 46 and DH is 57 in a few months. My goal is to pay off our mortgage by the time DH is 60 so in 3 yrs and 4 months.

 

Our mortgage is currently £70,589.08. Originally a seven year mortgage taken out last July 2021 on a two year fix of 1.32%. Current monthly payments of £945 (approx. £80 interest a month) and our house is worth approx. 320k.

 

We also have a btl property which we can sell if need be as we have under 75% ltv. Worth approx. 150k with mortgage of 106k.  Would love to sell the btl and throw the money at our mortgage but our tenant is fab and the house is a new build so no maintenance required at the moment. Also, DS is living with his girlfriend at the moment and one day, when he is earning enough (he’s one year into a four year engineering apprenticeship), we could sell it to him cheap or he could rent it from us.

 

Our mortgage is currently with NatWest.  If I op, NatWest reduce the monthly payments instead of the mortgage term. If I want them to reduce the mortgage term, I need to pay a fee of £30 each time I op!  So, I am squirreling the op money away every month and will make a 10% op once a year.

 

I love reading all the MFW diaries and hope keeping my own diary will help keep me focused.

South_coast

Good luck with your plans 🍀 

Just FYI, my mortgage was with NatWest and they didn't alter my repayments unless I made a one-off payment of £1000.00 or more. Anything £999.99 or less kept everything exactly the same. I never actually asked them "Is this overpayment decreasing the term", as I did them all online via bank transfer, but whenever they did recalculate the payments (either because I'd OP'd more than £1k in one go, or because it was the end of the fix), it was always done so that it would continue to run to the original term. That didn't bother me, as eventually I ran out of money owing to them and they had to acknowledge that I had paid it off and we had therefore reached the end of the term!

Sorry, that was a bit of a clunky way of saying it might be worth double-checking with them, as I never had any issues with them either reducing the payment or charging me a fee to reduce the term (because I never asked them to). But if you save up and pay 10% in one go, then they'll definitely reduce your payment as it'll be over £1k (and then your balance will reduce more slowly, as your lowered payments won't take as much off as they used to)

Mickyh-s

Thanks for that @South_coast
I will ask dh to give them another call to clarify. Dh is actually a mortgage advisor and didn't think that what I was saying was correct - maybe I didn't filly understand it when I called up. 👍

Mickyh-s

@South_coast you were correct in what you were saying regarding op on Natwest mortgage so today I have paid an extra £999. It feels so good and hopefully it will update on the app in a few hours.  I have made a note in my diary to do the same next month, not that I need a diary reminder. This can become addictive!

Will do a signature tonight and have a look at my finances to see if we can tighten the belt a little. We are actually very good with our finances, could be better, but we work hard and do enjoy a few treats. My weakness is my wardrobe...

Mickyh-s

Still buzzing from making my first op on the mortgage! 

 

I have calculated, that due to not understanding how overpaying worked on this mortgage (previous lenders do it very differently), I will not be able to pay the maximum 10% this year. I will save any extra money and put it towards next year’s op pot. When the 2 yr fix is up in July 2023, I will look at going to a lender who will allow unlimited overpayments – The Coventry were good at that but all depends on their rates.  The mortgage will be at approx. £45k by then and I don’t want to be limited to 10% overpayments in a year.

 

Going to look at bills this week to see if we can make any savings. We are usually very good at keeping a close eye on things. Since DS and his GF moved out last July, I have noticed a substantial reduction in electric and water consumption. The food bill has come down by a third too.

 

The fur baby needs a trip to the vets possibly this week and on speaking to the vets, was told his treatment would be in the region of £300. We do have insurance, but sometimes it’s not worth claiming for the smaller amounts.

 

We have friends over for dinner this weekend so I need to plan a menu and a shopping list.  Will see what I already have in cupboard/freezer and go from there.

 

Enjoy the rest of the week. Sunny here in Cambs so will go for a walk in my lunch hour.

 

TimSynths

Great to read MickeyH, I too am aiming for 2025 (May) and i'm taking a different route to my overpayments, they go into a S&S ISA which i'm hoping will grow by more than the interest on the mortgage (has massively so far).

Current Fixed deal is up in May 2025 and id like to be in a position to clear the balance should I choose too but at least be mortgage neutral. I did think about doing 1/2 to the mortgage directly and 1/2 to the ISA but death or glory!

Good luck on your mfw journey.

South_coast

Mickyh-s said:

@South_coast you were correct in what you were saying regarding op on Natwest mortgage so today I have paid an extra £999. It feels so good and hopefully it will update on the app in a few hours.

Yay! That's a cracking OP 😀!

Mickyh-s

Ok, so DH spoke to the vets today regarding the fur baby. They don't think they need to see him and do the original treatment they suggested and going to try antibiotics first therefore a saving of almost £280 - result!

Planned a menu for friends over for dinner on Saturday...
Pate & toast

Joe Wicks Popeye chicken
Homemade apple tart

I have most of the ingredients in so not a big spend. We even have beer/cider/wine leftover from Christmas.

Had to buy some bits today. Cards, the pate for Saturday night and a few other bits - £30 spent in my lunch hour. How does that even happen?!?! Going to try to not spend until payday on the 25/2 unless it's the food shop or petrol. Wish me luck! 

Mickyh-s

I have had a couple of nsd and have a week to go until payday. Petrol and food money gets put into separate accounts on payday so I always have enough until the end of the month.

Small food shop to do tomorrow but dh has a £20 voucher which will cover it and my parents are taking us out for Sunday lunch so another two nsd.

I am really focused on op on the mortgage this year. I can pay £7,500 up to 20.7.22 and have made my first payment of £999 earlier this week. Will aim to pay another £1700 in the next 4-6 weeks which will be a result.

Now, some may call me sad but I did a little experiment...bear with me...! Dh and I put our mobile phones onto charge when we go to bed and sometimes a tablet also. I wondered how much it was costing to just leaving them on charge all night even though they only take a couple of hours to fully charge. I take my own meter readings for gas and electricity at the beginning of the month to submit to my supplier. So, for a whole month, dh and I didn't put our phones charging overnight but did it for a couple of hours in the evening instead. Without doing anything different in those two months, the electric bill was almost £15 cheaper for the month we didn't leave our phones charging all night. A substantial saving I thought!

This makes me more aware of switching the three tv's we have, off at the wall as otherwise, they can only be switched off by leaving on standby - madness!  I also only have a small lamp on in the living room instead of the ceiling light with six bulbs in. These small changes has meant that when my fixed rate expired and I went onto the price cap, I have managed to keep my bills relatively low and not notice much of an increase.

Storm Eunice is in full force here in Cambs. My lovely boss sent me home just before lunch so I could get home safely so I'm sitting in bed (so i don't need to put the heating on) with the fur baby catching up on tv and on the internet.

Stay safe peeps and enjoy the weekend!

Mickyh-s

Just made another cheeky op of £999. Yay, go me!! 

Mickyh-s

Thank god it's the weekend! Am I the only one who feels like there are 6 days in the week?!

We have a holiday booked for June which needs paying soon. Luckily, I already have the money put aside. We also have a UK city break booked for August. The hotel is paid for so just need spends and maybe train tickets but dh said he may drive as there is a car park next to the hotel which is really reasonable. So that just leaves kennels for fur baby to pay for. Dh will save for holiday/city break spending money.

We have been doing the garden since we moved to this house almost 4 years ago. It is nearly complete except for the patio. We purchased most of the materials last year. Costs for materials have gone up considerably and if we had to buy the materials again now, would cost 25% more! Dh has the money put aside to pay for labor.

Other than Christmas(!!), I don't want any other expense this year as I want to throw as much as possible on op. My car needs an MOT in May so fingers crossed that won't need any additional work. I'm hoping the car keeps going until I have paid the mortgage off in 2025 and then I can get a newer one. But we all know, things never go as planned!

Got friends over for dinner this evening so really need to get my butt out of bed and do the washing, change the bed, clean, get a food shop in and jump in the shower!

Happy Saturday.