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Mortgage free in around five years (or close to it)

isadreamalie
isadreamalie Posts: 78 Forumite
Eighth Anniversary 10 Posts
edited 1 May 2022 at 1:14AM in Mortgage-free wannabe
I'm currently 32. Aiming to be mortgage free or close to by the time I'm 40. Certainly looks doable in the next six years if not sooner.

However my five year fixed comes to an end in November and I'm aware rates have gone up. Will probably stick with my bank to avoid extra remortgage costs and hopefully still get a fair deal...

My debt is just over £125k
My house was £350k bought with a £120k deposit over five years ago with £230k borrowed so I've cleared over £100k in just over five years (often throw 1k or more at it a month and maxed out my allowance last year) whilst my monthly payments on my current 1.99% interest have reduced from 950pcm to a little over 600pcm. Compares well with renting...  In 2015 I was paying 650pcm in rent !

I used overpayment to reduce monthly payments but will probably continue with the same term for the next fixed deal and continue to overpay but eventually overpay to reduce the term or be in a position to pay it off outside the fixed term

Comments

  • powerspowers
    powerspowers Posts: 1,319 Forumite
    1,000 Posts Fourth Anniversary Name Dropper
    Well done on your progress so far, £100k in 5 years is amazing!!
    A few things to bear in mind if you haven’t already- reducing the payment means you are using more of your OP allowance at the same time ad it decreases. You might have to stay with the same lender if you owe less than the minimum that a lender will lend (I’ve heard £30k). 
    Good luck with the rest of your mortgage slaying 🐉  

    MFW 2021 #76 £5,145
    MFW 2022 #27 £5,300 
    MFW 2023 #27 £2,000
    MFW 2024 #27 £6,055
    MFW 2025 #27 £1,700/£5,000


  • isadreamalie
    isadreamalie Posts: 78 Forumite
    Eighth Anniversary 10 Posts
    Well done on your progress so far, £100k in 5 years is amazing!!
    A few things to bear in mind if you haven’t already- reducing the payment means you are using more of your OP allowance at the same time ad it decreases. You might have to stay with the same lender if you owe less than the minimum that a lender will lend (I’ve heard £30k). 
    Good luck with the rest of your mortgage slaying 🐉  

    So perhaps a two year fixed mortgage is better than a 5 as the 10% allowance for overpaying is pretty poor once thr debt is under 100k



  • savingholmes
    savingholmes Posts: 28,912 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Photogenic
    Good luck on your journey - £100K in 5 years is impressive!
    Achieve FIRE/Mortgage Neutrality in 2030
    1) MFW Nov 21 £202K now £175.8K Equity 32.38%
    2) £4.3K Net savings after CCs 13/5/25
    3) Mortgage neutral by 06/30 (AVC £20.6K + Lump Sums DB £4.6K + (25% of SIPP 1.1K) = 26.3/£127.5K target 20.63% updated 16/5
    4) FI Age 60 income target £16.5/30K 55.1%
    5) SIPP £4.4K updated 16/5
  • isadreamalie
    isadreamalie Posts: 78 Forumite
    Eighth Anniversary 10 Posts
    edited 7 May 2022 at 7:14AM
    Good luck on your journey - £100K in 5 years is impressive!
    Thanks 😊 

    Helps having no partner no student debt no kids an 120k deposit on my house and a 60k job...

    I made an initial 10k overpayment early on as I had some savings left I could have added to the deposit. Reduced my monthly payment from 950 to almost 900 and that's when the overpayment addiction started!

  • powerspowers
    powerspowers Posts: 1,319 Forumite
    1,000 Posts Fourth Anniversary Name Dropper
    Well done on your progress so far, £100k in 5 years is amazing!!
    A few things to bear in mind if you haven’t already- reducing the payment means you are using more of your OP allowance at the same time ad it decreases. You might have to stay with the same lender if you owe less than the minimum that a lender will lend (I’ve heard £30k). 
    Good luck with the rest of your mortgage slaying 🐉  

    So perhaps a two year fixed mortgage is better than a 5 as the 10% allowance for overpaying is pretty poor once thr debt is under 100k



    I’ve just gone for a 5 year fix with 50% OP limit to get best of both worlds. We owe similar but paying off slightly slower due to aforementioned kids and student loans! 
    MFW 2021 #76 £5,145
    MFW 2022 #27 £5,300 
    MFW 2023 #27 £2,000
    MFW 2024 #27 £6,055
    MFW 2025 #27 £1,700/£5,000


  • savingholmes
    savingholmes Posts: 28,912 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Photogenic
    Good luck on your journey - £100K in 5 years is impressive!
    Thanks 😊 

    Helps having no partner no student debt no kids an 120k deposit on my house and a 60k job...

    I made an initial 10k overpayment early on as I had some savings left I could have added to the deposit. Reduced my monthly payment from 950 to almost 900 and that's when the overpayment addiction started!

    Still impressive.
    Achieve FIRE/Mortgage Neutrality in 2030
    1) MFW Nov 21 £202K now £175.8K Equity 32.38%
    2) £4.3K Net savings after CCs 13/5/25
    3) Mortgage neutral by 06/30 (AVC £20.6K + Lump Sums DB £4.6K + (25% of SIPP 1.1K) = 26.3/£127.5K target 20.63% updated 16/5
    4) FI Age 60 income target £16.5/30K 55.1%
    5) SIPP £4.4K updated 16/5
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