Chance to get rid of the mortgage

[p1stonhead]

TwigtheWonderkid said:

terrydacktal said:

mcbook said:

£5,000 on a once-in-a-lifetime holiday

Really? Have you even been on holiday in the last 10 years?

Agreed, £5K is a family of 4 in Ceterparcs for a week in the summer.

Hey now, he didnt say it wasnt a 1 night holiday

[red_slr]

bompey said:

Make sure you do self assessment to claim the additional tax back or do it via your employer.

I am a bit confused? What do you mean claim the additional tax back?

[egor110]

bompey said:

Pay off the mortgage, then whatever the mortgage payment was pay that into your pension as increased contributions. Make sure you do self assessment to claim the additional tax back or do it via your employer.

i'm a postie and currently maxing out the pension , any more i put in won't effect what royal mail add.

[TooMany2cvs]

£27k remaining on the mortgage, and you're repaying £800/mo at the mo? So you're only bringing repayment forward by about three years - how much interest would you be paying in that time? Less than a couple of grand.

So it might well be worth leaving the mortgage going, and doing something else with the money - if there's any spendiness you fancy.

[bmwmike]

egor110 said:

bompey said:

Pay off the mortgage, then whatever the mortgage payment was pay that into your pension as increased contributions. Make sure you do self assessment to claim the additional tax back or do it via your employer.

i'm a postie and currently maxing out the pension , any more i put in won't effect what royal mail add.

I think the suggestion might have been to open a SIPP to make additional pension provision.

With only a few years left I'd be investing the 25k personally. Inflation is likely to increase a lot which will help take care of your debt.. provided wages go up. If they don't, decide then. Your 800 per month is probably mostly paying off principle at this stage anyway.

[mcbook]

terrydacktal said:

Really? Have you even been on holiday in the last 10 years?

£1,000 - Flights from London to Bali for two people (see skyscanner)
£2,800 - 7 nights in a one bedroom villa with private pool in 5-star Chedi Club Tanah Gajah with private butler included (http://www.ghmhotels.com/en/tanah-gajah/)
£1,200 - spending money

OK, I assumed no kids but none have been mentioned by the OP.

[egor110]

mcbook said:

terrydacktal said:

Really? Have you even been on holiday in the last 10 years?

£1,000 - Flights from London to Bali for two people (see skyscanner)
£2,800 - 7 nights in a one bedroom villa with private pool in 5-star Chedi Club Tanah Gajah with private butler included (http://www.ghmhotels.com/en/tanah-gajah/)
£1,200 - spending money

OK, I assumed no kids but none have been mentioned by the OP.

No kids .

Our last big holiday was Maldives 4 years ago think that came in about 5k for the 2 of us A.I for 2 weeks.

[djc206]

terrydacktal said:

mcbook said:

£5,000 on a once-in-a-lifetime holiday

Really? Have you even been on holiday in the last 10 years?

Seeing as Bali has been referenced we're going in November for 10 nights, business class with Malaysian, B&B for £3200 for 2 people. We've not gone top end with the hotels but you could for the remaining £1800 from your budget very easily. We travelled through Vietnam for about £1500 each a few years back, that was in economy, add business seats and a couple of nicer hotels in and bingo you're at £5k. For most people these would be once in a lifetime holidays.

[Yipper]

TooMany2cvs said:

£27k remaining on the mortgage, and you're repaying £800/mo at the mo? So you're only bringing repayment forward by about three years - how much interest would you be paying in that time? Less than a couple of grand.

So it might well be worth leaving the mortgage going, and doing something else with the money - if there's any spendiness you fancy.

A couple of grand is a lot of money and not to be sniffed at. Free food for 1 person for an entire year, for example.

And if the saved mortgage cash of ~£10,000 a year is invested in a good pension, that could give another £4,000-18,000 in bonus cash over 2 years (via tax relief and investment gains).

The road to wealth is paying off the mortgage.

[valiant]

Use the money to clear the mortgage.

Get another mortgage to fund the orangery.


I don't really do financial advice.sorry!

[superlightr]

Yipper said:

The road to wealth is paying off the mortgage.

the road to real wealth is having someone else pay the mortgage!! ie a rental property.

depends on the area you could use the £25 as a deposit and get the rest as a BTL mortgage with the term matching the rental income so its close to a £0 input from you........

[patmahe]

Could be more reflective of my personality than anything else (I certainly shouldn't be giving financial advice), but I love the idea of being mortgage free and having X amount extra per month. If nothing else it opens up options these are examples only but I always find options are great to have.

1. In true PH style sell the house, buy a classic Ferrari, rapidly go bankrupt maintaining it and get divorced, start a thread here asking where did it all go wrong.
2. Take a job closer to home, possibly less pay but less stress.
3. Consider early retirement.
4. Use the 'spare' cash to fund a business.
5. Sell the house and buy a boat and sail around the world
6. Sell the house and buy a nicer, cheaper house somewhere sunny with a tiny cost of living and relax

[JagBox]

TwigtheWonderkid said:

terrydacktal said:

mcbook said:

£5,000 on a once-in-a-lifetime holiday

Really? Have you even been on holiday in the last 10 years?

Agreed, £5K is a family of 4 in Ceterparcs for a week in the summer.

Just released why I'm poor - I'm having the holiday of a lifetime every year!!!!!!

[egor110]

superlightr said:

the road to real wealth is having someone else pay the mortgage!! ie a rental property.

depends on the area you could use the £25 as a deposit and get the rest as a BTL mortgage with the term matching the rental income so its close to a £0 input from you........

Is this actually true ?

there are loads of posts re the change of the btl tax break ending so think i've missed the boat there.

[TooMany2cvs]

egor110 said:

superlightr said:

the road to real wealth is having someone else pay the mortgage!! ie a rental property.

depends on the area you could use the £25 as a deposit and get the rest as a BTL mortgage with the term matching the rental income so its close to a £0 input from you........

Is this actually true ?

there are loads of posts re the change of the btl tax break ending so think i've missed the boat there.

By "£25", I'm assuming superlightr means £25k...

As a rough rule of thumb, you won't get a BtL mortgage above 75% loan-to-value, for a start, and the lender will be looking at the rent covering at least 125% of the repayments. You can't offset mortgage repayments against the rent for income tax, and you can only offset the mortgage interest against basic rate income tax. Don't forget the 3% SDLT hike when you buy it, which'll pretty much wipe out the first year's income unless you've found some amazing deal.

So, yes, it can work - but it's not exactly foolproof. If you look at rental income only, BtL isn't any kind of jaw-droppingly astonishing investment, especially when you consider the hassles and how illiquid it is. So it's all down to how you see future house prices going... (and don't forget CGT there)

[rossub]

JagBox said:

TwigtheWonderkid said:

terrydacktal said:

mcbook said:

£5,000 on a once-in-a-lifetime holiday

Really? Have you even been on holiday in the last 10 years?

Agreed, £5K is a family of 4 in Ceterparcs for a week in the summer.

Just released why I'm poor - I'm having the holiday of a lifetime every year!!!!!!

No offence meant to anyone, but 2 weeks in the sun somewhere isn't really a holiday of a lifetime anymore - regardless of where it is. Back in the 80s it would have been.

Need to double that anyway for a couple on something that's really 'holiday of a lifetime' material.

[Granfondo]

Why not swap to an offset mortgage which would have a zero balance which is basically you are debt free but have availability of funds if you need it.

[drainbrain]

egor110 said:

superlightr said:

the road to real wealth is having someone else pay the mortgage!! ie a rental property.

depends on the area you could use the £25 as a deposit and get the rest as a BTL mortgage with the term matching the rental income so its close to a £0 input from you........

Is this actually true ?

there are loads of posts re the change of the btl tax break ending so think i've missed the boat there.

I'd guesstimate that whoever buys this.....

http://www.futurepropertyauctions.co.uk/property_d...

...will end up spending £25k to get it on the rental market, and will bank £400pcm after costs.

(ps: I'm good at guesstimating)

[djc206]

rossub said:

No offence meant to anyone, but 2 weeks in the sun somewhere isn't really a holiday of a lifetime anymore - regardless of where it is. Back in the 80s it would have been.

Need to double that anyway for a couple on something that's really 'holiday of a lifetime' material.

That depends on your holiday history and what constitutes luxury to you. You can quite easily do a fantastic trip through SE Asia for that money. If you're not fussy about what sort of hotel (read motel) you stay in you could road trip across the US. It all depends on how expensive your taste is. If you want to fly in business/first or stay only in 5* hotels, eat in Michelin starred restaurants, go somewhere really left field etc that will eat a fair chunk of your budget.

[anonymous-user]

I still remember the day I became mortgage free even though it was many years ago.

A feeling worth having imo.