£34.5k in 12 months

mobilechicane

So at the beginning of 2023 wifey and I both got lucky and gained different roles at our respective employers her pay went up by about £5k mine by about £10K.

There was just over £39K on our mortgage and we'd just fixed it at 3 years with a 3% overpayment penalty on anything over 10% of the gross balance. 

I had paid off all my vehicles the previous year and my new role had a couple of overtime heavy months due to large projects that were coming on stream.

So I pulled on my big boy pants and absolutely smashed the overtime.

Our set monthly payment was £950 a month, we were overpaying a minimum of £1K a month with one month after working for 28 days with one day off showing an overpayment of £3500.

The overpayments had to be made over the phone and our provider had to ask us each time where the extra money was coming from ( I did think of spinning a tale about meeting a high school science teacher and investing in his side hustle but decided against that)  the truth of better pay and no other debts was accepted with no issues.

We got down to £4500 just before Xmas and were looking to do the killer overpayment January 2024 however a quick discussion with our provider we found that we would actually save £200 if we let the product run out and dropped our payment to less than £150 a month.

Its an amazing feeling and we still may change our minds and kill it at the end of 2024 as the early redemption payment may get waived at that point if we owe under a certain amount.

The "extra" money we now have will be put into a saving account for some well deserved luxuries. 

Brie

Well done on cracking this!  

[Deleted User]

Hi,

well done indeed.

So are you going to pay £150 for 12 months (£1800) to save £200?

Go with your first idea, ''do the killer overpayment January 2024'', get the monkey off your back, then freedom.

mobilechicane

frugalmacdugal said:

Hi,

well done indeed.

So are you going to pay £150 for 12 months (£1800) to save £200?

Go with your first idea, ''do the killer overpayment January 2024'', get the monkey off your back, then freedom.

we were looking at that but the it would actually cost us £200 more ( with fees etc )  I am going to have a more detailed discussion with our provider in the new year as we have been with them from day one and they have never been beaten when we go to renew so they may agree to "pushing forward" allowable overpayments.

The £150 a month is less than 10% of what we were paying (including the smallest overpayment) so not really an issue, we would actually pay more in total if we did the killer payment and it would remove any possibility of a holiday that didn't involve a tent in a soggy field in wales next year and I don't fancy that again.

GrumpyDil

Is it worth paying more into your pensions as that is generally a very tax efficient way of saving? 

mobilechicane

Ok folks a final update, we were down to £1500 so I called the provider and they dropped the pay off now fee to £30 for us, this was in feb 2024, we killed the mortgage that day and I then spent the next month finding the job I wanted to do rather than the job I needed to do.

As our FMO is now sub £900 to run the house I could take a pay cut.

Again I got very lucky and found a new role with much less stress and a much shorter commute, the best bit I took a £500 per year pay cut compared to my previous role however the new role runs a 9 day fortnight so I have every other friday off,  £500 for 26 extra days off bargain in my book.

I'm also maxing out my pension and savings and have even treated myself to a new car.

For those who are doing the mortgage kill I'd say go for it