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  • FIRST POST
    • ch4rly2002
    • By ch4rly2002 19th Jan 17, 1:37 PM
    • 403Posts
    • 1,588Thanks
    ch4rly2002
    Dreaming of financial freedom!
    • #1
    • 19th Jan 17, 1:37 PM
    Dreaming of financial freedom! 19th Jan 17 at 1:37 PM
    Hi everyone reading this!

    I hadn't thought about writing my own MFW diary until another user suggested it, so I have no idea if anyone will be interested in what I have to say, but I'll just post it and you can ignore if it's rubbish So here's my story...

    I turn 30 next month and I would like to be mortgage free as soon as possible. My husband and I work in IT and, at least in my company, it seems to be that most jobs are being moved abroad. My dad also worked in IT was made redundant at 53 before my parents had finished their mortgage so I think that is why I am so anxious about having mortgage debt and would like to pay it off ASAP.

    We bought our first house in 2006 and sold it three years later in the middle of the recession for a loss of 6k, which wasn't ideal but it allowed us to purchase a house we couldn't have otherwise afforded as the vendors needed a quick sale so were prepared to drop their price. We moved in to the new house at the back end of 2009 and didn't need to do anything to it, which is a good job as we didn't have any spare money at the time! After a few years I got a job that paid well and we started overpaying on the mortgage, which we decided to do rather than save up as we would get a nice lump sum if we were made redundant. I loved seeing the mortgage go down!

    In 2011 my dad was diagnosed with a progressive neurodegenerative illness, which means his brain is slowly dying and was given a life expectancy of approximately 7 years, although it differs for everyone. My parents decided to make the most of their time together and bought a static caravan by a lake, which they lived in happily for a couple of years before my dad started having too many falls to continue living there and they moved into an independent living unit near Holmfirth, which isn't too far from where my in-laws live so it made visiting them all on our weekends up from Nottingham so much easier! By 2014 my dad had deteriorated quite a bit and my husband and I discussed leaving Nottingham so we could live closer to our parents in Yorkshire. At this point, the house was valued at 170,000 and the mortgage was at 108,000. Had we stayed and continued paying the same amount each month we would be mortgage free by 2021 but if we moved we would either have to rent (which we both saw as dead money) or buy another place that would be more expensive for a comparable house so it was a difficult decision. Around the same time my father-in-law got cancer, so we decided that moving up would be the best option. The only problem was that my dad was deteriorating rapidly and it takes ages for houses in our area to sell so we'd miss the last bit of time with my dad in a reasonable condition and could miss being there for the in-laws when they needed us through the cancer treatment process. At this point, I suggested we rent out our house and buy another house closer to our parents. I first spoke to my mortgage provider and asked if there was a way to release equity from our house and move it onto a buy-to-let mortgage then purchase another property. Unfortunately they wouldn't allow us to do this, but luckily MSE sings the praises of London and Country mortgage brokers and as they don't charge a fee I thought it would be worth giving them a call. I am so glad I did! My advisor Adam found me a new residential mortgage and let-to-buy mortgage (which is apparently very similar to a buy-to-let mortgage but it is when you already owned the property when you decided to rent it out) so we could use equity from our house. A couple of months later we moved into our new house and our old house was rented out shortly after.

    After 2 years, our fixed deals have just come to an end and this is where we now stand...

    Residential mortgage:
    Started at 216,000 on 3.29% with no OPs allowed.
    From January 4th, the property has 80% LTV and is on 1.99% for 3 years with 10% OP allowed. Started at 204,000 but as I had to guess what amount I would need when I first applied 3 months ago, we were refunded 1,404 so the mortgage now stands at 202,596. The standard mortgage payment 916 but I set the DD up at 1,100 as that's what we paid before so there is an overpayment there without any hardship. I can't wait to see this go under 200k, and then I will set 10k goals.

    Buy-to-Let mortgage:
    Started at 136,000 on 4.79%, and we started making overpayments of 250pm.
    From February the property will have a 73% LTV and will be on 2.64% for 2 years. Again, we applied for this mortgage 3 months ago and I guessed 129,000 but when I checked yesterday it stood at 127,895 so we will be due some money back and will pay that off the mortgage straight away.The standard DD is 638 but I am considering whether to leave the payments at 1,000 as they previously were.

    The only fly in the ointment now is that our jobs aren't as secure as they used to be, and there are rumours of redundancy packages being dropped to statutory rates, which I understand isn't very much. This has made me think that we ought to have some savings in case one or both of us gets made redundant. We have 1500 in premium bonds saved up for house repairs but that wasn't much of a safety net. Luckily, we have just received a cheque for 4,900 from my husband's stock that he just sold so for the first time ever we finally have some security. We would have previously put it straight on the mortgage but with the current uncertainty around jobs it is nice to have a bit of a safety net. The timing couldn't be better!

    I'll be honest. I'm rubbish with budgets. I don't know how much we spend and I know I could be a lot more careful with my spending. We do have takeaways and eat out quite a bit, mainly because we both work long hours and very tired on an evening and don't want to then spend a big chunk of our evenings cooking. If I'm even more honest, part of it is laziness However, I want to change that as I'm sure we could save some real money and be healthier if we cook more so I'm thinking maybe meal plans, online shopping so I don't get tempted by add on products and don't have to give up a load of time to go to the supermarket, and maybe the odd ready meal in place of a takeaway when we're feeling tired / lazy. I am also going to have a look into slow cooker recipes that I could put on in a morning so it's ready for us as soon as we finish working.

    My goal is to start logging what we spend and make a proper budget!

    Some (limited) financial info:
    Husband earns around 3,000 net each month.
    I earn around 1,700 net each month.
    Rental income, after expenses, is 678 per month.

    Mortgage 1 1,100
    Mortgage 2 322 (1,000 payment minus 678 rent, assuming we keep the payment the same)
    Car loan 500 (ends in October 2017)
    Loan to In-Laws 250 (not accruing any interest)
    Water bill 26
    Council Tax 128
    Gas & Electric 94.14
    BG Home Care 29.50
    Mobile 1 13
    Mobile 2 20
    Sky TV, internet and phone 70.93 (up for renewal tomorrow so will haggle or switch to Virgin)
    Car insurance 632 in 2016 (paid in a lump sum in April)
    Home insurance 491 in 2016 (paid in a lump sum in December)
    Pet insurance 69.61 in 2016 (paid in a lump sum in November)
    Landlord insurance 219.21 in 2017 (paid in a lump sum in January)
    Rent Guarantee and Legal insurance 125 in 2017 (paid in a lump sum in January)
    Gas Safety Certificate 60 (annual, paid in February)

    Unsure on food and entertainment costs (really need to get a grip on this) but after paying our credit cards we end up with between 500 and 1500 left at the end of the month, which we have recently been spending on home improvements, insurance, Christmas etc. so we haven't saved much of this. We are also thinking about joining a gym so that might also be another expense in future. If I think of any other expenses I will add them but I think that's pretty much it for now.

    I will try and update this as and when I get more information or manage to make savings / OPs. Thanks for reading!
    Last edited by ch4rly2002; 20-01-2017 at 9:44 AM. Reason: Forgot to include the current mortgage values.
Page 24
    • themadvix
    • By themadvix 10th Apr 19, 8:06 AM
    • 2,286 Posts
    • 12,900 Thanks
    themadvix
    Great news about the house and interviews Charly! Good luck with both!

    Well done for stepping up for your friend. I'm sure she really appreciates it and court will feel less intimidating as a result. I hope it all goes well for her.
    OPs 2018 = 2090
    Moving savings = 3085
    OPs 2017 = 3103
    Starting balance 2012: 132000; balance Jul 2018: 91,552
    MFW2018 no. 38
    • ch4rly2002
    • By ch4rly2002 16th Apr 19, 1:17 PM
    • 403 Posts
    • 1,588 Thanks
    ch4rly2002
    Thanks Vix. Good news - my friend won her court case and the occupation order was awarded in her favour From seeing his nasty side in court, and his family's, I can see why she was so scared and intimidated but I think it helped having me and her step-daughter there (her boss gave her the day off so my mum stayed at home). He was told he has to leave in 48 hours and the judge signed a non-molestation order that was effective immediately (I think that's like a restraining order and they normally come into effect after 48 hours but the judge initiated it immediately). Her ex was not happy and is trying to intimidate us by pacing back and forth outside the house and sitting on the bench outside our houses for hours on end tapping his foot and looking annoyed. He's been making fake phone calls to people to make it sound like he's asking someone to come and 'sort us out', it's all mind games and we don't believe it for a second, but it would be stupid to completely ignore it so I've ordered some security measures that we can fit ourselves when they arrive tomorrow. the next step is for her to get him off the deeds so that will cost her, which I think is dreadful, but it will mean he is out of their lives and she can start living again.

    The house sale has now completed and we should receive the money in a few days! Sadly I ticked BACS instead of CHAPS, which means we have to wait 3-4 days to receive our money, but on the plus side it saved us 36. We have a settlement figure from what we owe the in-laws so we will pay that off as soon as the money comes in. Once the solicitor and in-laws have been paid, we should end up with about 42.5k, and we are still debating what to do with it. I think we've pretty much decided on paying off the cars. That would take 31,757.77 but it will mean we don't have to pay out 719.47 each month so that could go towards our holidays and mortgage payment. I told DH that maybe he should save his 432.10 each month for the holiday fund and I would overpay my 287.37 on the mortgage as holidays are more important to him and paying the mortgage is more important to me.
    Savings: Aim 13.5k. Dec 2016 1,700 / Apr 2019 13,100
    Mortgage: Mar 2018 -300,000 / Apr 2019 -288,620
    CC 0%: Nov 2016 -4,500 / Apr 2019 -2,955.73
    Loan to In-Laws: Sep 2010 -48,185.82 / Apr 2019 -26,815.49
    Student Loan: March 2011 -18,275.04 / April 2018 -13,277.73
    • themadvix
    • By themadvix 17th Apr 19, 8:16 AM
    • 2,286 Posts
    • 12,900 Thanks
    themadvix
    That sounds like excellent news all round Charly! So pleased that your friend has got rid of the horrible man and has the law on her side now to protect her.

    Paying off the cars sounds like an excellent idea and a good plan for the resulting freed up money too.
    OPs 2018 = 2090
    Moving savings = 3085
    OPs 2017 = 3103
    Starting balance 2012: 132000; balance Jul 2018: 91,552
    MFW2018 no. 38
    • ch4rly2002
    • By ch4rly2002 17th Apr 19, 9:25 AM
    • 403 Posts
    • 1,588 Thanks
    ch4rly2002
    Thanks Vix. He has to leave by 4pm today so we'll be keeping an eye out to make sure he's gone before she comes round. We'd hate for him to hide in the house or something. Then we start the task of helping her clean the house top to bottom (he hasn't cleaned it in 9 months, but he hasn't been careful or made any attempt to minimise dirt either) and redecorate. Hopefully when it's repainted and clean it will feel like a different place. She also needs to get a builder in to fix a wall he knocked a hole in, but that can be one in due course. I've also ordered some sash jammers and things for her so she can make the house more secure.

    The money arrived in our bank account today... 66,000 We've never had, and probably never will have, that kind of money in our account before so it's a bit surreal. We'll pay off the loan to the in-laws this week, but I think we'll have to do it in chunks as I think there's a cap on how much you can transfer at once. I forgot that on top of the 719.47 the car loan repayment would make, we're also going to be saving 250 a month from the loan to the in-laws. So, in total we should be 969.47 better off each month That leaves us with 12,000 to pay for things on our 'to-do' list. Happy days!
    Savings: Aim 13.5k. Dec 2016 1,700 / Apr 2019 13,100
    Mortgage: Mar 2018 -300,000 / Apr 2019 -288,620
    CC 0%: Nov 2016 -4,500 / Apr 2019 -2,955.73
    Loan to In-Laws: Sep 2010 -48,185.82 / Apr 2019 -26,815.49
    Student Loan: March 2011 -18,275.04 / April 2018 -13,277.73
    • themadvix
    • By themadvix 17th Apr 19, 11:19 AM
    • 2,286 Posts
    • 12,900 Thanks
    themadvix
    Wow, 66,000 in the bank and you're being so sensible!

    Excellent news about the additional money being freed up too.

    You're a very good friend to your neighbour - I'm sure she appreciates all you do for her. I hope that once it's decorated and secure she feels happier there and can put the past behind her.
    OPs 2018 = 2090
    Moving savings = 3085
    OPs 2017 = 3103
    Starting balance 2012: 132000; balance Jul 2018: 91,552
    MFW2018 no. 38
    • Subnerter
    • By Subnerter 17th Apr 19, 2:17 PM
    • 1 Posts
    • 0 Thanks
    Subnerter
    Someone has mentioned casino and gambling here, I'd like to add that if you are looking for financial freedom you have to forget about such things like gambling because here you can spend a great amount of money without any sense. Of course, sometimes you can make some free spins in some online casino or app like but I recommend you to make it for fun only and don't become an addicted person.
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