Project 2018

EatingTheElephant · 7 May 2016 at 12:20PM

Impressive work so far with a solid plan in place

LadyGnome · 7 May 2016 at 5:24PM

I admire your determination and organisation. Roll on 2018!

Ms-Bristol · 2 July 2016 at 12:21AM

On 1st July I checked the balance and it was just over £89K, so I'll be able to pay just over £8900 now. I have this amount so on Monday, I'll be calling them and asking for the exact figure so I can make that payment.

Ms-Bristol · 11 September 2016 at 11:17AM

July's 10% overpayment was received by the bank and for the first time, they did not levy overpayment penalties. The balance was reduced to just over 80K and the monthly payment was reduced. Now saving for next July but as the amount diminishes, more funds will need to be put aside into savings.

Currently looking at switching energy supplier and internet provider as these have crept up.

Kittenkirst · 11 September 2016 at 12:12PM

Fab stuff Ms Bristol! Well done on such a massive Overpayment

A_Frayed_Knot · 13 September 2016 at 6:51PM

Hello, Your doing just great reducing your mortgage balance in such a short time. Well done :j

However, I am slightly confused, you mention you overpay each month, then make your 10% allowance o/p in July, but surely your o/p each month actually count towards your 10%, so when you o/p your lump sum in July it takes you over your allowance?

Re- the o/p's reducing your payments and not your term, if the above was the case, then would it not be better to reduce your term - thus upping your normal monthly payments which in effect would be o/ping without penalty, then still have your 10% allowance?

rasputin_thorpedo wrote: »

Hi Ms B - Man v Mortgage here,
I've just started and also have a 10% rule - are you absolutely certain when your 10% year-ends are? I thought mine would be the anniversary of the product but it's actually Dec 31st - although you got me questioning that now! I'm with the H@lif@x.
I will be offsetting in future, but yes, until I hit the 10% rate I will be plugging it into the mortgage pure and simple. Bon chance! MvM

It is Dec 31st, for H@lifax, so the next 10% allowance starts 1st Jan each year. However if your fixed rate ends, say in Sept (like mine did, last year) you can obviously pay as much as you like (as out of deal) then take on new fixed deal, you would have a 10% allowance from Oct to 31st Dec (like I did) then another 10% from 1st Jan.

But to compensate for all o/p's previously made and with a raise in income, I added extra income figure (which was raise, interest saved in new deal and no internet to pay for 1 year) to my normal payments and reduced my years (took 6 and a half years off) so still had a 10% allowance allowed every year.

mrsp1987 wrote: »

I was having a chat with my dad yesterday and he was asking about my 10% cap as well. For me it runs from January to December rather than the anniversary of the loan, which I find simpler.
*He asked if I could pay 10% in October and then 10% again in January which got me thinking.
I'm also limited by only being able to make a minimum repayment of £500 at a time and my aim is to save up £500 and then make a payment. So, what I might do is find out how much I've got of my 10% left in the middle of **December and then make a lump sum from some of my savings. It might not be up to the full amount but maybe knock another 2/3K off it.

*See my above answer to your dad's question, bearing in mind I'm with the H@lifax.
**That's exactly what I done in Dec 31st last year as, as they say "once it's gone - it's gone" meaning the 10% allowance for that year - you can never get last year's allowance back - it's gone. Have to tell you - I was so happy I done that - right decision for me

and saves you interest in the meantime

I have been told by my mortgage company that I can actually reduce my term even more, without penalty :eek: even though I'm only 11 months into my 2 year fixed deal. Thought this may be my solution to o/p more as I have reached my 10% only 8 months into this year.

Ms-Bristol · 26 September 2016 at 11:09PM

Just to clear up those questions:

I am not with the Halifax and my year runs from 1st July. On 1st July this year I phoned the bank and they told me the amount I could pay (10% of outstanding balance) which I did shortly after. This reduced my balance and my monthly amount.

Then all the other amounts I save each month get put away in savings accounts because I cannot pay any more into the mortgage until the next year.

These savings will accumulate until July 2018 when the fixed rate ends - which is also when the 10% limit on overpayments is lifted. The aim is to have the balance (or thereabouts) by then so that the mortgage can be paid off.

But it is correct that if you don't pay off the whole 10% within the year, you cannot roll forward the amount into the next year as it is recalculated again on day one of the next year (whenever that may be).

A_Frayed_Knot · 26 September 2016 at 11:30PM

Your doing fantastic, so far.

Just 2 points, I wondering about,

are you not allowed o/p's of 10% each year?, which would then let you o/p 10% next July 2017 instead of when your fixed rate ends in July 2018, and

Do they explain why you cannot keep paying the same amount each month, with or without o/p's? Worth asking.

Ms-Bristol · 26 September 2016 at 11:42PM

Yes, I will pay 10% overpayment next year as well on 1st July 2017. That amount will be about £7500 by then.

When I make an overpayment of over three times the monthly instalment, the bank recalculate the monthly repayment amount. I presume you can make a load of smaller payments up to the 10% but which are each individually under three times the monthly amount.

But that would be fiddly and make very little difference to the ultimate goal. As I pay less per month, I can save more.

Ms-Bristol · 1 May 2017 at 10:58AM

At the end of April, the statement from the bank arrived showing a balance of £77K. This means that by 1st July (my overpayment date) the balance will be about £76K and I'll be able to overpay around £7,600 and the new balance will be around £69K.

This is quite good but my pot for overpaying the remaining sum in the summer of 2018 has not grown as much as it should. I reckon I'll be about £20K short of having enough when my fixed rate ends.

Project 2018

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