Mortgage gone by 2030

LadyWithAPlan

Well done on the OP target being hit 

so you use Airtime Rewards as that gets you cash off your mobile bill 
and surveys are worth looking at 

hellosupernova

LadyWithAPlan said:

Well done on the OP target being hit 

so you use Airtime Rewards as that gets you cash off your mobile bill 
and surveys are worth looking at 

Thanks What are Airtime Rewards? 

minimad125

Congrats on the overpaying, dedication that is. Just out of interest, what is your interest rate as mine is only 1.63% for another 36 payments then changes to whatever it is at the time. I currently overpay £65.68 a month (strange i know) but this gets me to the £30k mark when it finishes. I also save into a higher interest savings account so that I can maximise the rest of the money so if I have the funds to pay it off, I will. Would you not be better off doing more or less the same or do you just want to get rid of the it as quick as possible?

hellosupernova

minimad125 said:

Congrats on the overpaying, dedication that is. Just out of interest, what is your interest rate as mine is only 1.63% for another 36 payments then changes to whatever it is at the time. I currently overpay £65.68 a month (strange i know) but this gets me to the £30k mark when it finishes. I also save into a higher interest savings account so that I can maximise the rest of the money so if I have the funds to pay it off, I will. Would you not be better off doing more or less the same or do you just want to get rid of the it as quick as possible?

Hi minimad125. Thanks for reading. My interest rate is 3.35% so what I overpay goes further towards paying off capital until my fix ends start of October this year. I am likely to be paying 4.6% interest level then and the interest added each month to the balance will jump up again.

I do put money in savings each month as well. On purely financial yes I would likely be better off just saving however I do really want to be rid of the mortgage sooner than another 13 years as it can realistically be done in say 5 years from now. The psychological benefit of not having to worry about paying a mortgage is something I think is worth aiming for. I am also concerned what the future will bring in terms of increasing interest rates and cost of living.

I am reviewing my options every few months so we shall see if things need to change. At least I know that I won't see 70k balance ever again so any progress is something even if I need to change strategy later on.

isadreamalie

hellosupernova said:

minimad125 said:

Congrats on the overpaying, dedication that is. Just out of interest, what is your interest rate as mine is only 1.63% for another 36 payments then changes to whatever it is at the time. I currently overpay £65.68 a month (strange i know) but this gets me to the £30k mark when it finishes. I also save into a higher interest savings account so that I can maximise the rest of the money so if I have the funds to pay it off, I will. Would you not be better off doing more or less the same or do you just want to get rid of the it as quick as possible?

Hi minimad125. Thanks for reading. My interest rate is 3.35% so what I overpay goes further towards paying off capital until my fix ends start of October this year. I am likely to be paying 4.6% interest level then and the interest added each month to the balance will jump up again.

I do put money in savings each month as well. On purely financial yes I would likely be better off just saving however I do really want to be rid of the mortgage sooner than another 13 years as it can realistically be done in say 5 years from now. The psychological benefit of not having to worry about paying a mortgage is something I think is worth aiming for. I am also concerned what the future will bring in terms of increasing interest rates and cost of living.

I am reviewing my options every few months so we shall see if things need to change. At least I know that I won't see 70k balance ever again so any progress is something even if I need to change strategy later on.

You see things the same way I do
Down to circa 106k debt now (£584 a month roughly which feels cheap)
The lower your monthly payments the more you can overpay
If you hit the 10% ceiling you can save that money and pay off your mortgage once the mortgage expires
Saving feels more boring in comparison! I'm still placing £250 a month into an additional pension scheme

hellosupernova

End of Financial Year Update

Slightly delayed update as I was waiting for my mortgage statement to come in the post.

New mortgage statement shows the following:

Closing balance as of 31.03.23: £79,843.71

Closing balance as of 31.03.24:  £69,198.76 (interest was added on so did not manage to get my £69k exact figure)

Difference between these opening balances shows £10,644.95 capital cleared off.

So in the financial year I made £6,303.59 total overpayments.

Worked out my new 10% overpay allowance fee free is: £6,919.87

Total payments made towards the mortgage:  £13,172.24
Total interest:  £2,527.29

Rate       From                            To
3.35%    1 April 2023                  31 March 2024

If I compare this to the previous year mortgage statement:

Total payments made towards the mortgage:  £6,475.83
Total interest:  £2,278.77

Rate       From                            To
1.99%    1 April 2022                  1 September 2022
3.35%    2 September 2022        31 March 2023

Opening balance as of 01.04.22:  £84,040.77
Closing balance as of 31.03.23:    £79,843.71
Difference between these opening balances shows £4,197.06 capital cleared off.

If I had not made any overpayments at all this past financial year and had only paid my mandatory payments set at £584.44, the overpayment calculator is telling me the balance would be around £75,437.96 and around only £370 capital would have been cleared each month. That is around £6,239.20 difference to what has been cleared and would have meant capital cleared would be £4,405.75 versus the £10,644.95 that has been cleared. Currently clearing around £1k level monthly or thereabouts.

I have only really been paying the £500 level overpayments since July last year so thats 9 months of bigger overpayments and more impact. Current overpayment level is sitting at £650 but this is due to other savings being made elsewhere and added to the overpayments and the fact that the mandatory payments have kept being reduced, so I have been increasing the overpayment in response. I am happy with the progress made in one year and can see that there is benefit to doing it. Still sticking to the overpayments at the current level until the next fix. It will be interesting to see where things are in a few months time.  

hellosupernova

April Update

Total overpayments for April 24:   £688.76

Mandatory payment 30.04.24:      £547.25

Interest added 01.05.24: £189.98

Mortgage balance at 01.05.24:     £68,152.73

Overpayments for May 24 so far:  £3.73

Current mortgage amount (06.05.24): £68,149

Opening balance as of 01.04.24: £69,198.76
10% overpay allowance fee free: £6,919.87
Overpayments made so far this financial year: £692.49 / £6,919.87 (10% used) / (£6,227.38 left of allowance)
Capital cleared off balance so far this financial year: £1,049.76 / £10,000.00 (10.49%) / (£8,950.24 left to target)

isadreamalie

How are you getting on OP? 

My mortgage debt now stands at around 105k. Monthly payments now around £581 a month.

I started, in October 2017, with a debt of 230k and payments of £950 a month.

I'm starting to become aware that my monthly mortgage is pretty small despite no pay rise since October 2018. However it looks like I'm getting a rise (plus back pay) very soon

Monthly payments under £600 certainly feel much less. A five figure debt balance by the year end is exciting 

hellosupernova

isadreamalie said:

How are you getting on OP? 

My mortgage debt now stands at around 105k. Monthly payments now around £581 a month.

I started, in October 2017, with a debt of 230k and payments of £950 a month.

I'm starting to become aware that my monthly mortgage is pretty small despite no pay rise since October 2018. However it looks like I'm getting a rise (plus back pay) very soon

Monthly payments under £600 certainly feel much less. A five figure debt balance by the year end is exciting 

Hi isadreamalie. I am getting on well and still on track to reach my goal £60k balance by the time my current fix ends but I will probably need to pay a lump sum of £3k once out of the fix/remortgaging to get it to that level. I have that lump sum sitting ready in a savings account so at least I am prepared for it if needed. My next target will be how quickly I can get to £50k balance. I have worked out that once I get to around the £45k mark, the interest is not as much as a concern as I will be back to paying my current interest level even if the interest rate I had fixed at was 5%. So in my head the sooner I get close to the £45/50k mark it should be easy to make more progress.

I just read your mortgage diary and I can see how much progress you have made in a short time, so well done on that. Wishing you well on your journey going forward.

hellosupernova

May Update

Total overpayments for May 24:    £703.73

Mandatory payment 31.05.24:      £547.25

Interest added 31.05.24:               £193.25

Mortgage balance at 01.06.24:     £67,095

Overpayments for June 24 so far:  £96.00

Current mortgage amount (01.06.24): £66,999

Opening balance as of 01.04.24: £69,198.76
10% overpay allowance fee free: £6,919.87
Overpayments made so far this financial year: £1,488.49 / £6,919.87 (21.5% used) / (£5,431.38 left of allowance)
Capital cleared off balance so far this financial year: £2,199.76 / £10,000.00 (21.99%) / (£7,800.24 left to target)

May has been been a good month. I feel like I have made good progress on the overpayments. Today the balance after interest was sitting just above £67k. I had spare funds that I used to get it just into the £66k level, to give me a superficial psychological boost as its only £1 below! However this mortgage will NEVER be at £67k again!

I have also started to move funds into flexible savings accounts which will start to earn some interest, which is paid per month instead of waiting till the end of a year. So if needs be I can take the money back plus interest to use for overpayment lump sums or other requirements.

June looks like a more spendy month and the summer will probably follow suit but I will try to stick to my weekly budgets whilst also enjoying living life as well.

I am still hopeful that I may be able to get an ok interest rate for a 2 year fix soon. At the moment my thoughts are to do 2 years fixed which gives me the flexibility to pay lump sums in between the next fix period, rather than fix for 5 years on a slightly lower interest rate but be locked in with fees. There is also a chance I could be able to get the mortgage low enough for paying it off in full before the 5 year fix would be finished.