Planning to be mortgage free in 16 months

I think the title says it all really. I have been mortgage free before but in a house I didn’t love. We moved in 2020 just before lockdown and gained a new shiny mortgage. I felt sad that we were no longer mortgage free but we are much happier in this house. 


Our five year fixed rate mortgage changes to SVR on 1st April 2025 and I am determined to save as much as I can so the mortgage is paid off on that date. 


Our current mortgage rate is really low at 1.69%. Up until now we have made a maximum 10% overpayment each January (this is the maximum we can overpay without incurring charges). This year it makes sense to keep those savings in our savings account as the savings interest rate is higher than the mortgage. Then I can make a large overpayment on 01.04.25 when we change to SVR, which is also the date that the 10% overpayment limit disappears. 


I am a great lover of a spreadsheet or two. I have a sheet that shows how much I should save each month and how much I should have saved by April 25. It will be enough to clear the mortgage balance (keeping fingers crossed). 


This plan is fantastic but I’m so impatient. I love making mortgage overpayments! To not make any for 15 months is going to be hard for me as I gain huge pleasure from seeing the balance decrease. 


So I have decided that anything I can sell on Vinted or eBay in 2024 will be diverted straight to the mortgage. My mindset being that I haven’t expected to make any money from selling my unwanted household tat so it’s bonus money that doesn’t need to go into the savings account. I get bored of listing stuff on eBay and I think this is a great way of motivating me to do it plus I will get to declutter my house and add a few pennies (hopefully pounds) to the mortgage. 


I’m no stranger to overpaying the mortgage. I paid off our previous mortgage 8 years early, an achievement I’m really proud of. I can’t wait to be mortgage free again. 


Let the decluttering begin! 

If Plan A fails, remember there are 25 more letters

Comments

  • tjp70
    tjp70 Posts: 464
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    I forgot to say that our current mortgage balance is £40,639.26
    If Plan A fails, remember there are 25 more letters
  • South_coast
    South_coast Posts: 4,779
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    Sounds like a great plan, looking forward to seeing how you get on 👍

    P.S. I love your signature!
    Mortgage start: £65,495 (March 2016)
    Cleared 🧚‍♀️🧚‍♀️🧚‍♀️!!! In 5 years, 1 month and 29 days
    Total amount repaid: £72,307.03. £1.10 repaid for every £1.00 borrowed

    Finally earning interest instead of paying it!!!
  • Mark_d
    Mark_d Posts: 262
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    I'm in a similar situation.  I have a five year fixed rate deal ending in July 2025.
    Being mortgage free means that, in terms of cashflow, you have more disposable income each month.  But are you better off in the long term?  This is one for the spreadsheet!
    In 2025 my mortgage rate might jump from 1.5% to 5% and remain at that level for the remainder of the term (until 2035).  Over the period until 2035 I expect the return on my savings/investments to exceed 5% so maybe paying off the mortgage early isn't the best strategy for the long term?
    I'm also a lover of spreadsheets so I should try making projections.  My current thoughts are that I want a partial repayment in 2025 - so that I still have enough disposable income to spend on things I enjoy, whilst also taking advantage of the [relatively] cheap borrowing offered by the mortgage.
  • Consider a 0% credit card to enable you to overpay on the mortgage. I managed to shave a few years off mine by rotating about £25k on 2 different credit cards. Though mortgage rate was around 6% back then
  • tjp70
    tjp70 Posts: 464
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    Thank you all for the suggestions and support. 

    I’m not sure I’ve explained things properly. I save a lot each month into a savings account with a good interest rate. It makes sense to plough all my savings in there instead of throw it at the mortgage. At the beginning of April 2025, there should be enough in this account to clear the mortgage. But this (sensible) method means that there will be very little movement in the mortgage figure other than the monthly payment. 

    I dislike seeing only one payment a month on the mortgage so this diary is to chart my teeny tiny overpayments made through sales on eBay and Vinted of all the household stuff and my clothes. This money I will throw at the mortgage as it’s ‘bonus’ money. It will only be a few pounds here and there. 
    If Plan A fails, remember there are 25 more letters
  • beanielou
    beanielou Posts: 89,263
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    Happy shiny new diary  :)
    I am a Forum Ambassador and I support the Forum Team on Mortgage Free Wannabe & Local Money Saving Scotland & Disability Money Matters. If you need any help on those boards, do let me know.Please note that Ambassadors are not moderators. Any post you spot in breach of the Forum Rules should be reported via the report button , or by emailing [email protected]. All views are my own & not the official line of Money Saving Expert.

    Lou~ Debt free Wanabe No 55 DF 03/14.**Credit card debt free 30/06/10~** MFW. Finally mortgage free O2/ 2021****
    "A large income is the best recipe for happiness I ever heard of" Jane Austen in Mansfield Park.

    ***Fall down seven times,stand up eight*** ~~Japanese proverb.
    ***Keep plodding*** Out of debt, out of danger. ***Be the difference.***
    One debt remaining. Home improvement loan.
  • Archerychick
    Archerychick Posts: 179
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    tjp70 said:
    Thank you all for the suggestions and support. 

    I’m not sure I’ve explained things properly. I save a lot each month into a savings account with a good interest rate. It makes sense to plough all my savings in there instead of throw it at the mortgage. At the beginning of April 2025, there should be enough in this account to clear the mortgage. But this (sensible) method means that there will be very little movement in the mortgage figure other than the monthly payment. 

    I dislike seeing only one payment a month on the mortgage so this diary is to chart my teeny tiny overpayments made through sales on eBay and Vinted of all the household stuff and my clothes. This money I will throw at the mortgage as it’s ‘bonus’ money. It will only be a few pounds here and there. 
    It’s the same for me! For the first eight years of my mortgage i was very happily overpaying £700 a month, shaving a huge amount off the balance and seeing that go down was very satisfying! Fast forward to the last two years where the overpayment is going into a savings account so that come Oct 25 I have about £20k saved to pay off the whole thing. I can’t imagine the mortgage rates then will be lower than savings rates so that’s the likely outcome.

    To ‘trick my mind’ (sort of anyway), is in my finance software I’ve created another savings account for the mortgage overpayment where in essence money is allocated & then I can easily see this against my mortgage balance. I have I think three accounts in the finance software which just allows me to see how that money is allocated - general, mortgage, stoozing. 

    Equally having this in a spreadsheet does the same thing :) 
  • tjp70
    tjp70 Posts: 464
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    Good morning.

    The first sale of 2024 has been a long time coming. However yesterday I sold a mug and £3.30 has been sent to the mortgage account - woohoo! 
    If Plan A fails, remember there are 25 more letters
  • beanielou
    beanielou Posts: 89,263
    Academoney Grad I'm a Volunteer Ambassador Mortgage-free Glee! Name Dropper
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    Every little helps 😊
    I am a Forum Ambassador and I support the Forum Team on Mortgage Free Wannabe & Local Money Saving Scotland & Disability Money Matters. If you need any help on those boards, do let me know.Please note that Ambassadors are not moderators. Any post you spot in breach of the Forum Rules should be reported via the report button , or by emailing [email protected]. All views are my own & not the official line of Money Saving Expert.

    Lou~ Debt free Wanabe No 55 DF 03/14.**Credit card debt free 30/06/10~** MFW. Finally mortgage free O2/ 2021****
    "A large income is the best recipe for happiness I ever heard of" Jane Austen in Mansfield Park.

    ***Fall down seven times,stand up eight*** ~~Japanese proverb.
    ***Keep plodding*** Out of debt, out of danger. ***Be the difference.***
    One debt remaining. Home improvement loan.
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