Thirty-something on 30 year plan- No Thank you 30 December 2022 at 11:14PM in Mortgage-free wannabe 8 replies 385 views

BrownEyedLady

Hello!

I’ve discovered this forum as few days ago by chance because I was looking for best ways to overpay my upcoming mortgage eek 🫣 I found other peoples MFW diaries really interesting and inspiring! I decided to create a mortgage free journey diary because I can see how supportive you guys are on here and hold myself accountable and I thought I’d share my journey with the HTB loan as I have not see any on here. If you know any dairies that cover HTB equity loan please share them with me!

A bit about my current situation.

Born and bred Londoner, lived with parents for the last decade or so (rent was cheap!). It’s really unfair on us Londoners who want to stay in london. But I managed to find a flat one zone further than where I am which is a win for me!
I’m in the process of buying a flat in London after years of saving (no financial help from parents)- I’ve exchanged on 22nd December due to complete on 11th January 2023.

This was with HTB- secured it just before the deadline as I felt it was my only way to get onto the property ladder!

Mortgage: £208,000
Term: 30 years
Interest: 5.49% 🫣

I maxed out on the HTB loan, I originally wanted to max out on the mortgage and borrow less on the equity loan but the way interest rates were going, this plan for the best for me. This is why I am super keen to make overpayments in the first 5 years to reduce the mortgage and remortgage to cover the HTB loan. To do this I am going to do market research/surveys, overtime with my job (NHS nurse) but not too much otherwise I will burn out, I’m also hoping to make money via social media if i can. 

My flat is a 2 bedroom flat, I’m planning to let out the 2nd room via airbnb or Mon-Fri Let, (I was adamant that I have a 2 bed flat for this reason and it’s easier to sell at a later date if I need to!), that will go straight to overpayments.

If anyone knows a good readymade spreadsheet please let me know! I will do my statement of affairs once I have completed/moved in because all of my money is all joined up at the moment to pay off for completion!

Thank you for reading my first entry if you got this far! Speak soon

BEL
xoxo 

Langerhan

No financial help... apart from the last decade of cheap rent, you mean

I'm in a similar situation to you - 30-something buyer in London, making overpayments on my new build flat and doing a bit of work on the side to bring in extra cash (keeping it under £1000, though, so I don't go above my allowance!). However, I didn't worry about looking for a two-bed as I knew that would be above my budget. I'm impressed you managed to find somewhere that was eligible for HTB; all the places I looked at that were HTB were also way above what I could afford.

Do you know how much you're likely to make from renting out the spare room? I know you can use the Rent a Room Scheme up to £7500 and have to pay income tax on anything else, but I don't know what Monday-Friday lets tend to go for.

Welcome to MFW!

BrownEyedLady

Langerhan said:

No financial help... apart from the last decade of cheap rent, you mean

I'm in a similar situation to you - 30-something buyer in London, making overpayments on my new build flat and doing a bit of work on the side to bring in extra cash (keeping it under £1000, though, so I don't go above my allowance!). However, I didn't worry about looking for a two-bed as I knew that would be above my budget. I'm impressed you managed to find somewhere that was eligible for HTB; all the places I looked at that were HTB were also way above what I could afford.

Do you know how much you're likely to make from renting out the spare room? I know you can use the Rent a Room Scheme up to £7500 and have to pay income tax on anything else, but I don't know what Monday-Friday lets tend to go for.

Welcome to MFW!

😆 Well I meant no cash help from the bank of Mum & Dad! Yes in that sense I did have some help in saving my money from the ridiculous london rent prices.

This flat I found was actually over my budget, it wasn’t until they dropped the price and got alerted on right move (they were keen to sell due to the HTB deadline looming).

I had a look at spare room in the area to see what I can get for part time lodger which is about 500-600 PCM which I think is quite low, not sure if that is the norm. So, I might have to get a full time lodger for a year or do airbnb as that’s slightly more income. 

Do you plan to remortgage to cover the HTB loan or save up and pay it off?

Thank you! I have saved your dairy to follow! It’s great to see someone in a similar situation as most people’s diaries on here don’t have HTB. I look forward to reading your entries! 

BrownEyedLady

Happy New Year guys! 🎉

Yesterday I had my pre-inspection check with the developers and a professional snagger.

The snagger told me my flat was well built that he has seen in a long time (that’s quite scary!) and had minimal issues that needed to be fixed which is good news! I have seen some horror flats that were poorly built and not thought out at all. At one the properties I looked at, I couldn’t open the bathroom draw because the door hinge was blocking it, I showed this to the estate agent, he was so embarrassed but kept calling me to look at other flats to get me to buy. They really don’t care do they?!

I’ve been told theses will get fixed before completion date so that’s good. I also measured the windows for curtains or blinds (haven’t decided yet!) and for the sofa. I should order the sofa now as I know it can take a while for it to come!

I’ll keep you up to date in what’s been happening. Speak soon

BEL 
xoxo 

BrownEyedLady

Hello!

What a stressful 24 hours! 😖

Yesterday my broker called me after my night shift sleep to say that my bank did not process the payment, meaning that my product fee would be on top of the mortgage which means interest will occur on the product when I asked to pay upfront. So my broker suggested that they reapply for a new offer. So I got in touch with my solicitor and they said the developer have the right to fine me for delays, have to reapply for new ATE which could delay completion by a week at least, so they advised not to reapply. 

Anyways, both parties contacted the bank and its all sorted, they processed my product fee payment and sent all the relevant paperwork (I totally forgot I did not get the paperwork! This what happens when you are working full time and studying for your Masters) I’m kinda annoyed that my broker did not check this with me. Also one of my bank statements was a duplicate of the same month and they only noticed yesterday and after reading through the paperwork I needed building insurance again that wasn’t checked with me if I had it in place 😤. I get people make mistakes but 2 in one day. I definitely won’t be using this broker again for future house purchases/remortgaging.

Completion is still set for tomorrow 😅😮‍💨

Got my exam for tomorrow, wish me luck!

BEL
xoxo

BrownEyedLady

Sooooooo, I’ve completed! Officially a homeowner!

I can’t believe I’ve done it after waiting so long.

I’ve set up the banking app and can see my mortgage in place. I’m itching to start overpaying now but I need to be sensible, sit down and look at how much money I have left over to buy the sofa and curtains etc.

I’ve been given this massive file of all things to do with my flat. Lots of bedtime reading for me!

BEL
xoxo 

LeighofMar

Congrats on being a homeowner. Your flat sounds like it was a good deal. 

BrownEyedLady

LeighofMar said:

Congrats on being a homeowner. Your flat sounds like it was a good deal. 

Thank you!

I see you haven't got long left to go with your mortgage, I bet you cannot wait!

LeighofMar

Definitely. I'm wanting so bad to pay it off now, savings be darned, but I know it's not the prudent thing to do. Especially with inflation and recession talk 😥