No hurry to pay off the mortgage

[ro250]

vulture1 said:

It should be made law that a legal agreement is made before couples buy a house with different contributions.
It would remove the stigma of it not being romantic/ trusting of the guy (usually) having to bring it up in conversation.

But it's not all about financial contributions as it's far more complex. e.g. Female stays home and raises the kids while father earns all the household income (or vice versa). Not fair that mum gets less in event of break up as those household roles each have value.

[LeadFarmer]

Regardless of any agreements about who paid what, when she finds out he's been playing away she will rinse him for every single penny, and she will win.

[vulture1]

ro250 said:

vulture1 said:

It should be made law that a legal agreement is made before couples buy a house with different contributions.
It would remove the stigma of it not being romantic/ trusting of the guy (usually) having to bring it up in conversation.

But it's not all about financial contributions as it's far more complex. e.g. Female stays home and raises the kids while father earns all the household income (or vice versa). Not fair that mum gets less in event of break up as those household roles each have value.

It's not fair that Dad gets no emotional time and bonding with his kids while he goes out and earns money. You are trying to balance emotional bonding and values with physical cash values. Something that when the love is gone the Dad generally loses out on.

[Welshbeef]

vulture1 said:

ro250 said:

vulture1 said:

It should be made law that a legal agreement is made before couples buy a house with different contributions.
It would remove the stigma of it not being romantic/ trusting of the guy (usually) having to bring it up in conversation.

But it's not all about financial contributions as it's far more complex. e.g. Female stays home and raises the kids while father earns all the household income (or vice versa). Not fair that mum gets less in event of break up as those household roles each have value.

It's not fair that Dad gets no emotional time and bonding with his kids while he goes out and earns money. You are trying to balance emotional bonding and values with physical cash values. Something that when the love is gone the Dad generally loses out on.

And in break up it’s nearly always the mum gets the kids the family home and then the Dad has spousal maintenance until she remarries of finds a new partner.

The male on the other hand now had to rent a bedsit /studio and run a 15 year old car. Cannot afford his own days trips out has to earn big just to cover these costs.

[pb8g09]

Welshbeef said:

And in break up it’s nearly always the mum gets the kids the family home and then the Dad has spousal maintenance until she remarries of finds a new partner.

The male on the other hand now had to rent a bedsit /studio and run a 15 year old car. Cannot afford his own days trips out has to earn big just to cover these costs.

I'm sure earlier thread last week you were suggesting that every man should have children... snigger...

Edited by pb8g09 on Tuesday 3rd November 16:39

[Welshbeef]

pb8g09 said:

Welshbeef said:

And in break up it’s nearly always the mum gets the kids the family home and then the Dad has spousal maintenance until she remarries of finds a new partner.

The male on the other hand now had to rent a bedsit /studio and run a 15 year old car. Cannot afford his own days trips out has to earn big just to cover these costs.

I'm sure earlier thread last week you were suggesting that every man should have children... snigger...

Edited by pb8g09 on Tuesday 3rd November 16:39

I do

[Pit Pony]

ro250 said:

Uhtred said:

We just got our first house this year (I put in 2/3 of the deposit and pay 2/3 of the mortgage every month).

Was meant to get something in writing at the time to say i owned a certain percentage and she owned a certain percentage but never bothered.

I’m now wondering if it’s worth starting to overpay. Currently a 25 term at a 2.29% interest rate. I could easily overpay by a few hundred every month however I have the feeling my partner doesn’t or not yet anyway.

Any issues if we were to proceed with our current approach whereby I would overpay by two thirds of a certain amount and she pays a third? Not sure if it would confuse who receives what in the event of a split..

Is this your business partner or your wife?

Sarcasm aside, I don't think it works like that unless you really do a proper prenup. Many, in fact probably most, couples don't equally contribute to the mortgage.

Basically once you've been married 2 years, what's yours in hers, and what's hers is yours jointly. Add in kids and it's even more clear cut.
If you have shares off shore, then it matters not whose name they are in.
If you are not married, but are not tenants in common, but joint tenants then its very clear that it's a 50:50 split. Very rare that solicitors explain the difference.
Even if you pay 99.9% of the mortgage, and put in 99.9% of the equity, if one of you died all the house minus the loan belongs to the other.
And as an aside both of you will be jointly and severaly liable for 100% of the loan. That is if the other disappears or declines to pay you are liable.

[GH421]

I have enough capital to pay my mortgage off or put a deposit towards an investment property (roughly half of the property value)

my job situation has changed where now I was contracting and making good money but now they're forcing me to make me permanent. I will assess the situation once the virus goes as I always liked contracting but the permanent job makes me lose a substantial amount in residual income that i could potentially save per year.

I've always been in the mindset to buy an investment property when the next recession comes but thinking now whether to pay the mortgage off as property prices don't seem to be dropping as they were back in 2008-2011

[anonymous-user]

I was on a busy Tube one evening with a couple of work colleagues and they started talking about mortgage rates, and I jokingly said "What on earth is a mortgage?" and one of them replied "It's something that poor people have" quite loudly.

We were just messing about but got awful lot a lot of dirty looks. No one else seemed to find it funny.

[okgo]

Lord Marylebone said:

I was on a busy Tube one evening with a couple of work colleagues and they started talking about mortgage rates, and I jokingly said "What on earth is a mortgage?" and one of them replied "It's something that poor people have" quite loudly.

We were just messing about but got awful lot a lot of dirty looks. No one else seemed to find it funny.

It's pretty grim chat tbf.

[anonymous-user]

okgo said:

Lord Marylebone said:

I was on a busy Tube one evening with a couple of work colleagues and they started talking about mortgage rates, and I jokingly said "What on earth is a mortgage?" and one of them replied "It's something that poor people have" quite loudly.

We were just messing about but got awful lot a lot of dirty looks. No one else seemed to find it funny.

It's pretty grim chat tbf.

I agree.

But dark, offensive, rude, or gallows humour can often be the funniest I find. However it is advisable to only do it around likeminded people.

[NickCQ]

Lord Marylebone said:

I agree.

But dark, offensive, rude, or gallows humour can often be the funniest I find. However it is advisable to only do it around likeminded people.

Punching up is generally better than punching down, though

[SkinnyPete]

SkinnyPete said:

TLDR: changed my mind, decided to overpay

The good news is my mortgage is now down to about £35k, and I feel very content with that.

Maybe I'll update this thread in another couple of years to congratulate myself on being mortgage-free, we'll see.

I thought it was worth posting an update.

The good news I now owe only £12,500, which I should be able to clear in the next few months.

It has felt like a bit of a bottomless pit at times, as no matter how much I earn and no matter how much I save, the mortgage just swallows it up.

The problem now is to clear the mortgage; the ERC is coming out a few hundred quid more than the interest over the remaining course of the loan. Technically it makes sense to wait for the term to finish and then pay off the remaining balance, but for the sake of a few hundred quid, I think I'll just get rid of it when I can. This is very much an emotional decision.

Overall though, I'm very happy, and can't wait to live life mortgage free.

[67Dino]

Lord Marylebone said:

I was on a busy Tube one evening with a couple of work colleagues and they started talking about mortgage rates, and I jokingly said "What on earth is a mortgage?" and one of them replied "It's something that poor people have" quite loudly.

We were just messing about but got awful lot a lot of dirty looks. No one else seemed to find it funny.

At the risk of being literal, I actually don’t think a mortgage is what poor people have. A mortgage is what rich people have, because they’re home owners. In fact the very richest people have some colossal mortgages, because it’s cheap borrowing and a tax efficient asset and they’re not worried about paying it back.

[RichardAP]

SkinnyPete said:

I thought it was worth posting an update.

The good news I now owe only £12,500, which I should be able to clear in the next few months.

It has felt like a bit of a bottomless pit at times, as no matter how much I earn and no matter how much I save, the mortgage just swallows it up.

The problem now is to clear the mortgage; the ERC is coming out a few hundred quid more than the interest over the remaining course of the loan. Technically it makes sense to wait for the term to finish and then pay off the remaining balance, but for the sake of a few hundred quid, I think I'll just get rid of it when I can. This is very much an emotional decision.

Overall though, I'm very happy, and can't wait to live life mortgage free.

Congratulations, I’m sure it’s a lovely feeling, but obviously it’s now time to move to a bigger house, extend or borrow enough for a new Ferrari...

[Pit Pony]

SkinnyPete said:

SkinnyPete said:

TLDR: changed my mind, decided to overpay

The good news is my mortgage is now down to about £35k, and I feel very content with that.

Maybe I'll update this thread in another couple of years to congratulate myself on being mortgage-free, we'll see.

I thought it was worth posting an update.

The good news I now owe only £12,500, which I should be able to clear in the next few months.

It has felt like a bit of a bottomless pit at times, as no matter how much I earn and no matter how much I save, the mortgage just swallows it up.

The problem now is to clear the mortgage; the ERC is coming out a few hundred quid more than the interest over the remaining course of the loan. Technically it makes sense to wait for the term to finish and then pay off the remaining balance, but for the sake of a few hundred quid, I think I'll just get rid of it when I can. This is very much an emotional decision.

Overall though, I'm very happy, and can't wait to live life mortgage free.

I took put a ten year fixed, and came I into a small inheritance from a great aunt who gave me 1/45th of her estate. I did the sums, and decided to overpay by the max amount every month for 3 years, then paid £12 a month for 3 years. Then the lender wanted £280 to send me a paper copy of the deeds. I ignored that letter, and a year later they sent me a copy free. It's all electronic with the land registry, so i thought that they were taking the piss.

I think it was the point that I starting paying £12 that I felt that relief.

Then saved up the mortgage payments over the next 5 years and used it for a deposit on a Buy to let. Then saved up the mortgage payments and the profit on the rental for 3 years and bought a second home.
Then had a heart attack due to stress of wondering how I was going to pay both mortgages during the pandemic. Luckily tenant kept paying and I found a work contract before running out of cash.

Now the profit on the rent is paying the BTL mortgage off in 10 years and the 2nd Home has 14 years left on it.

I'm not sure it was a great idea to buy it. Ties me in, to an asset that requires maintenance, but on the other hand gives me somewhere to live as my work contract is close enough that I can commute from it.

The interest and utilities work out at about £125 a week, or 2 nights in a hotel.
The capital, I'm seeing as a tax inefficient savings plan.
Again that's about £180 a week. But assuming prices don't rise or fall, I'll get it back If I were to sell it suppose.

[cholo]

I personally think the thought of having your mortgage paid off is overrated.

I see it as a monthly expense, just like anything else.

The house or your life won't change once the mortgage has gone,

Say your mortgage is £700 per month. Once paid off you will be £700 a month better off.

Obviously, very nice but not a life changer and i have much more exciting things to look forward to in life.

Once paid it effectively like having a £700 a month pay rise. Nice, but not a game changer.

Having said that, then if you are going to overpay, then the best time to do it is now.

I don't quite get the people who say they will do it when interest rates rise? If you wait until then, any overpayment will have a much smaller effect on the mortgage and will take longer to pay off.

[Mack11]

[/quote] I don't quite get the people who say they will do it when interest rates rise? If you wait until then, any overpayment will have a much smaller effect on the mortgage and will take longer to pay off.
[/quote]

Well the answer is... I can earn more interest investing my cash, personally I have averaged over 35% interest on the stock market in the last three years, I only need to be at 3% over the next 15 years to be better off. If interest rates tripled, I might decide that overpaying the mortgage is the better investment as its a guaranteed saving.

If I could afford to pay off my mortgage today, I would just buy a bigger house. I of course understand the psychological value in being mortgage free but that rarely makes it the best financial decision.

[cholo]

I was more referring to one of the posers above who said they were waiting for interest rates to rise before overpaying.
They were obviously not intending to invest in S&S (or if they were, that was separate to the overpayments), so my point was - if you are going to do it at all - do it now! When interest rates rise it will have a much smaller effect on either your monthly payment amount, or term (whichever you choose to reduce)

[Mack11]

cholo said:

I was more referring to one of the posers above who said they were waiting for interest rates to rise before overpaying.
They were obviously not intending to invest in S&S (or if they were, that was separate to the overpayments), so my point was - if you are going to do it at all - do it now! When interest rates rise it will have a much smaller effect on either your monthly payment amount, or term (whichever you choose to reduce)

I agree if it is just sitting there, after a rainy day fund it makes no sense (in my opinion) to keep cash in a bank account.

It also makes no sense buying expensive sports cars, most of us are trying to balance enjoying life and thinking of the future/surviving.