Renovations and Repayments II: New Year, New Start, New Diary.

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  • hiddenshadow
    hiddenshadow Posts: 2,525 Forumite
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    Love the sound of your goals for the future, Alex. :)
    AlexLK wrote: »
    Get a better rate on mortgage. Shamefully we have never shopped around for this before. :o Is it worth spreading the mortgage payment over a longer term to reduce the monthly payment due so the overpayment is effectively higher each month or shortening the term so the £1,000 is all repayment?

    Effectively it doesn't matter, as the interest amount paid to principal would be the same. e.g. if you normally pay £750/mo and £150/mo of it is interest, it's the same if you make a £250 OP to get it to £1,000 or if you change your term so that you pay £1,000 as a regular payment. (£750 - £150 interest = £600 payment + £250 OP: £850 to principal...vs. £1,0000 - £150 interest: £850 to principal)

    Having said that, a few things to consider:
    - there may be limits on how much you can OP, so you may not be able to always OP the full £250...this would not apply if your standard payment was £1,000 and you made no regular OPs
    - with planning OPs, plans can always go awry. ;) This can be both a pro (you're not locked in to the £250 OP so if you had a spendy month you could skip it) and a con (you're not locked in so can overspend even if you don't wish to)
    - picking a longer term will mean you pay more over time, unless you do always OP the extra to make up the difference (see point #2)
    - just a note from our circumstances, we picked a 5yr fix last time with the plan to pay it all off in 5 years..that plan went to pieces 1 year in when we decided to move abroad. ;) So now we're faced with an early repayment charge next year when we sell the house. What seems like a sure-thing plan one day/year might not be at all true in following years, so it may be worthwhile choosing the more flexible option when you hunt for a new mortgage deal.
  • AlexLK
    AlexLK Posts: 6,125 Forumite
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    Well, my younger self would have never imagined it to be new year's eve, completely sober and posting on here. :rotfl: :eek:

    Thank you, Watty, Debs, Kelpie, SL, Maddie and Hidden Shadow. :)

    SL - Can you post a link to your diary, please?

    Maddie - For the first time in a very long time I can say I'm looking forward to seeing what the future brings. :) I've come to realise my parents do what suits them and will always agree with each other. Father was quite distressed when I saw him earlier today, he tells me he thinks I'm doing well with my life, have done a lot to help him and this coming year should be a positive one for my wife, son and I. However, when mother joins in the conversation he agrees with her that I've been a disappointment to them. I will never please them and believe whatever had come of my life I would be a disappointment to them.

    Hidden shadow: Thank you for the advice. It makes sense. I'm not really sure what will be the best option for us at the moment. I missed that you are moving, where are you going?
    2018 totals:
    Savings £11,200
    Mortgage Overpayments £5,500
  • A_Frayed_Knot
    A_Frayed_Knot Posts: 3,296 Forumite
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    Hi AlexThought I would pop on and say what a pleasure it is to read your shiny new diary :)

    No coaxing needed from me this time to make new challenges and goals. You are well ahead of the game :D

    About re-mortgaging and a new deal, I would only mention what HS has already stated - watch out for your overpayment restrictions.
    Happy and Healthy New Year to you and your Family, wishing you all the best.
    Always have 00.00 at the end of your mortgage and one day it will all be 0's :dance:
    MF[STRIKE] March 2030[/STRIKE] Yes that does say 2030 :eek: Mortgage Free 21.12.18 _party_
    Now a Part Timer from 27.10.19
  • AlexLK
    AlexLK Posts: 6,125 Forumite
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    Thank you, AFK. :)

    I find the monthly challenges / goals help me to focus. I need to make a complete January target set.

    Most mortgages have an overpayment limit of 10% of the mortgage value, IIRC?

    Wishing you a happy and healthy new year, also. :)
    2018 totals:
    Savings £11,200
    Mortgage Overpayments £5,500
  • beanielou
    beanielou Posts: 90,268 Ambassador
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    Mine is 10%.
    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 forumteam@moneysavingexpert.com. 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****
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  • gallygirl
    gallygirl Posts: 17,228 Forumite
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    AlexLK wrote: »


    - Finish the house and consider our options (staying in current house or using the equity to move somewhere new - not to my childhood home and if I mention this, please feel free to point me to this starting post) ;)
    Quoting this just in case you accidentally delete it in the future :rotfl:.
    AlexLK wrote: »
    I will never please them and believe whatever had come of my life I would be a disappointment to them.
    Alex if you're damned if you do and damned if you don't you might as well just do as you damn well please :).

    Here's to 2018 :beer:.
    A positive attitude may not solve all your problems, but it will annoy enough people to make it worth the effort
    :) Mortgage Balance = £0 :)
    "Do what others won't early in life so you can do what others can't later in life"
  • hiddenshadow
    hiddenshadow Posts: 2,525 Forumite
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    AlexLK wrote: »
    Hidden shadow: Thank you for the advice. It makes sense. I'm not really sure what will be the best option for us at the moment. I missed that you are moving, where are you going?

    Probably worth seeing what the options are and how big a difference they make when you run the numbers.

    We moved to Ireland last August. :)
    Most mortgages have an overpayment limit of 10% of the mortgage value, IIRC?

    I think that's standard with most lenders, I believe it's 10% based on the balance at the start of each year (not 10% of the original balance).
  • gallygirl
    gallygirl Posts: 17,228 Forumite
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    hiddenshadow wrote: »
    We moved to Ireland last August. :)
    Whereabouts are you HS? (roughly!). We're in Kerry presently and off to see Fungie later, hopefully :D.
    A positive attitude may not solve all your problems, but it will annoy enough people to make it worth the effort
    :) Mortgage Balance = £0 :)
    "Do what others won't early in life so you can do what others can't later in life"
  • newgirly
    newgirly Posts: 8,940 Forumite
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    Happy new year Alex :)
    2022 MFW 67 - 33 month challenge to clear mortgage, month 17 completed and and extra 2 knocked off 🙂MFI3 No.12
  • bunty109
    bunty109 Posts: 1,265 Forumite
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    hiddenshadow wrote: »
    Probably worth seeing what the options are and how big a difference they make when you run the numbers.

    We moved to Ireland last August. :)



    I think that's standard with most lenders, I believe it's 10% based on the balance at the start of each year (not 10% of the original balance).

    We’re with First Direct and there’s no limit to overpayments but would get charged if we paid it off during our fixed term period (no chance of that!)
    MFW 2019#24 £9474.89/£11000 MFW 2018#24 £23025.41/£15000
    MFi3 v5 #53 £12531/
    MFi3 v4 #53 £59442/£39387
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