Anyone trying to pay down a large mortgage?

Free_Mike

Hi All,

I've followed many of these threads with interest. However it seems that most of the mortgages that others are trying to pay down are (relatively) much smaller than my own. Anyone else with something around £300k that they want to pay off??

I ask because I think the approach needed to pay something of this size of in a relatively short period (say 5 years) differs from that which most people on the board are adopting. To pay this sort of size mortgage off in 5 years you would need to make overpayments in the region of £4-5k per month:eek:. Not the sort of spare cash that most of us have hanging around.

I think the approach therefore has to be to start/run a business that has the potential to pay off this amount in the required time (let's face it a 2nd job isn't going to do it!!).

I guess there are other alternatives to having a mortgage of this size - I could for example move 200 miles further north and find a cheaper house - however the wife and family like it where we are and the house is one we want to stay in for a long time.

Alion

We're working on a £200k mortgage, our solution is to spend more time on it - 3yrs would be unrealistic - we'd be paying about 3x our combined salary, but aiming for 10-15 years (we're near the end of year 1 of 25) is much more realistic and we can re-assess that as our requirements change

setmefree2

Hi

We started with a £250k mortgage 5 and a half years ago:eek:. We are now down to £162k with an endowment due to come in 4 years with a minimum £37K pay out. So it's about £125k now.:jWe've just tried to stretch what money we have - not become miserly,just getting same for less - still had hols etc but done without excessive amounts of clothes, take aways etc...We can't be mortgage free in 3 but maybe we can cut our 25 year mortgage to 10 years.;)

silvercar

Exactly what we are doing Mike.

The only thing I would say is that businesses take a while to get going and some do fail. We contemplated the big move (& big mortgage) once the business was established and bringing in the money.

For security we made sure that we could afford the normal repayments if the business was there, even if we couldn't afford to reduce the capital.

whitewing

I think there are long term strategies and short term strategies required for overpaying a mortgage.

I find the debt free wannabe forum most useful for dealing with day to day spending and have joined a couple of their challenges this year. And I don't feel deprived in lifestyle either.

The long term strategy may take a while to formulate. I am on a fixed-rate for 5 years mortgage, so I'm concentrating on what I can do during that period first to make life easier when I remortgage. I don't think in my circumstances that it is going to be possible to clear it completely by then, but it's surprising how it does all add up.

catshark88

Hi,

We are down to £220k but our initial mortgage was approx £350k (2-3 years ago).

DH and I both have expensive hobbies but we are trying to be penny pinching bar those.

I have started a very small part time business and all profit from that goes straight off the mortgage.

It's a bit of a grind paying off quite big sums and still having tons left to find, but as Whitewing says, it is surprising how quickly the next payment adds up.

setmefree2

Catshark that's amazing overpayments!:D Was that all done by just being frugal(ish)?

angelavdavis

I am not quite at your level Mike.

I am trying to overpay my £130k mortgage now to pay it off in as close to three years as possible at a rate of £3k per month and its really really hard! I have got the mortgage down to just under £120k since April 2007 when you take into account the funds in the offset account.

I went freelance to do this - trebling my income, but am putting the money into an offset - a precaution just in case I don't get a new contract. However, I am lucky - my skills are fairly scarce and in demand, so I haven't had too much trouble on the earning front.

I am also trying to apply to AQA currently, with the plan that I will work a couple of evenings every week and I will shorten the term of the mortgage to increase the payments so I can effectively pay the AQA earnings off the capital of the mortgage, as well as having the offset savings.

Even with all the moneysaving techniques I learned while being a DFW, it is still a huge challenge.

I am also ebaying and using cashback on credit cards (£120 in a year) and quidco (quidco has brought me an additional £600 since I joined year ago - lucky because I was able to get cashback on my work-related hotel costs, etc).

catshark88

setmefree2 wrote: »

Catshark that's amazing overpayments!:D Was that all done by just being frugal(ish)?

I wish! DH used to have a job that paid large bonuses and those helped a lot. I just wish we had found this site a few years earlier!

Free_Mike

I agree with the running theme of smalls steps towards paying down is better than no steps at all. However . . . . .

. . .do those of us with large mortgages have to resign ourselves to the fact that we can'tbe mortgage free in a short(ish) amount of time?.

setmefree2

It's up to you in the end, isn't it? There is a challenge some where on MSE where people are trying to live on 4k a year (Trust me - I couldn't:eek:). If we did this we would probably all be mortgage free in a very short time:D