Who is overpaying on their mortgage?
Discussion
Just out of curiosity, those of you have have a mortgage, do you overpay? If so, how much, and with the overpayments you make how much will this reduce the term of your mortgage and how old will you be when it is finished (at your overpayment rate)?
I'm just curious to know what others do. I got my 1st house 2 years ago and in Feb this year I decided to start overpaying, only by around £55-60/month, it's a 35 year mortgage and only for £170k so my normal monthly amount is only £543 so I just make it a round £600. Even without overpayments I will still be younger than 65 by the time it is paid off.
Half of me thinks I should probably pay more and get it done even earlier, but the other half of me says live and enjoy life a little bit whilst you're still (relatively) young
Just wanted to know what other people are doing, and why they have chosen the amount they have.
Cheers!
I'm just curious to know what others do. I got my 1st house 2 years ago and in Feb this year I decided to start overpaying, only by around £55-60/month, it's a 35 year mortgage and only for £170k so my normal monthly amount is only £543 so I just make it a round £600. Even without overpayments I will still be younger than 65 by the time it is paid off.
Half of me thinks I should probably pay more and get it done even earlier, but the other half of me says live and enjoy life a little bit whilst you're still (relatively) young
Just wanted to know what other people are doing, and why they have chosen the amount they have.
Cheers!
We used to have an 800 quid mortgage and paid an extra 200 per month. When it reduced down to 600 on remortgaging we kept the payments the same.
Now we've moved but yet to sell or old house, so no overpaying right now. But when we do we'll put that money back on the mortgage. Should get a 30 year mortgage paid in about 17 years.
Now we've moved but yet to sell or old house, so no overpaying right now. But when we do we'll put that money back on the mortgage. Should get a 30 year mortgage paid in about 17 years.
When I was single I would transfer whatever was in my bank account at the end of the month. Made a massive difference for no real hardship
Then when married we’d keep our joint account around x, anything left over at the end over x would get transferred.
Since kids, not really thought about it!
But play with over payment calculators
Even £10 a month makes a difference in terms of term left to run
Then when married we’d keep our joint account around x, anything left over at the end over x would get transferred.
Since kids, not really thought about it!
But play with over payment calculators
Even £10 a month makes a difference in terms of term left to run
We pay chunks off ours. With our business the way money comes in is usually in large amounts as and when as opposed to monthly. When we have a good month we just pay off some of it. £20k over the last 12 months. Easier said than done when trying to finish the place too.
I think we are down to the last £20k which should be cleared by next year.
We have had the house 16 months borrowed £40k Should be mortgage free by my 36th birthday.
(It helps that a 4 bedroom detached house where we live only costs £70-80k) More spare cash for holidays and cars once we have finished renovations.
Realistically I don't really count the mortgage as "debt" as we will always need somewhere to live and if we aren't paying a mortgage we will be paying rent. (Mortgage works out at £180 a month)
I think we are down to the last £20k which should be cleared by next year.
We have had the house 16 months borrowed £40k Should be mortgage free by my 36th birthday.
(It helps that a 4 bedroom detached house where we live only costs £70-80k) More spare cash for holidays and cars once we have finished renovations.
Realistically I don't really count the mortgage as "debt" as we will always need somewhere to live and if we aren't paying a mortgage we will be paying rent. (Mortgage works out at £180 a month)
I used to but since having kids that went out the window. Never been so poor but earn more than I ever have 
So yes I would recommend overpaying before you have kids, if not utilise spare cash but prepare for the future. At times I've spent way more than my mortgage on childcare (mortgage = 975/mth) but now it's about 70% of my mortgage now they are both at school and that's only for 3 days a week care!
So yes I would recommend overpaying before you have kids, if not utilise spare cash but prepare for the future. At times I've spent way more than my mortgage on childcare (mortgage = 975/mth) but now it's about 70% of my mortgage now they are both at school and that's only for 3 days a week care!
We bought our house in 2014, then moved abroad to work in 2016, with a considerable uplift in wages.
We had bought right at the lower end of our budget anyway, so managed to pay off the mortgage completely after a couple of years abroad.
We were very lucky with circumstances I think.
It made sense, as our interest rate was 5% (buy to let as a job UK resident).
We had bought right at the lower end of our budget anyway, so managed to pay off the mortgage completely after a couple of years abroad.
We were very lucky with circumstances I think.
It made sense, as our interest rate was 5% (buy to let as a job UK resident).
I overpaid on ours for about 15 years. Its paid off now. In recent years its not been as "worthwhile" due to low interest rates but its still a good feeling to come home at night knowing it really is my house.
We had 2 houses on the go so had to mortgage our new house but then we sold the old house which because we had been overpaying on both it meant the equity from the old house was enough to pay off the mortgage on the new one.
The first few years it does not really seem to make much difference but once you get going on it after say 5-10 years it makes a massive difference.
Paying off the house was one of our 2 major goals for retiring early so we are 50% the way there.
We had 2 houses on the go so had to mortgage our new house but then we sold the old house which because we had been overpaying on both it meant the equity from the old house was enough to pay off the mortgage on the new one.
The first few years it does not really seem to make much difference but once you get going on it after say 5-10 years it makes a massive difference.
Paying off the house was one of our 2 major goals for retiring early so we are 50% the way there.
Was overpaying alot enough to be on track to be pretty much mortgage free by 45 which was always an aim for me. We have been overpaying by roughly by 30-40% every month, cleared and 1/4 of the over debt within the frist 3 years of moving to the current house.
But now contemplating a house extension that will add 25% to existing mortgage, bizarrely though current addtional mortgage borrowing is actually at a crazy low 1.6% fixed for 5 years so the overpaying wasn't in vain. Will still aim to be mortgage free by 50 at the latest even with the extension built.
Personally I don't see the point of having a big cash amount in the current accounts, and ISA rates are so slow clearing the mortgage debt just makes sense. The additional borrowing at below inflation values though is crazy, its like the banks almost don't want you to clear the debt....
But now contemplating a house extension that will add 25% to existing mortgage, bizarrely though current addtional mortgage borrowing is actually at a crazy low 1.6% fixed for 5 years so the overpaying wasn't in vain. Will still aim to be mortgage free by 50 at the latest even with the extension built.
Personally I don't see the point of having a big cash amount in the current accounts, and ISA rates are so slow clearing the mortgage debt just makes sense. The additional borrowing at below inflation values though is crazy, its like the banks almost don't want you to clear the debt....
Edited by gangzoom on Saturday 2nd November 10:45
Edited by gangzoom on Saturday 2nd November 10:47
gangzoom said:
Personally I don't see the point of having a big cash amount in the current accounts, and ISA rates are so slow clearing the mortgage debt just makes sense. The additional borrowing at below inflation values though is crazy, its like the banks almost don't want you to clear the debt....
Not necessarily so. A shares ISA invested in Shell for example yields 6.5%, and Shell have never reduced their dividend since the war. Perhaps something to think on.lowdrag said:
Not necessarily so. A shares ISA invested in Shell for example yields 6.5%, and Shell have never reduced their dividend since the war. Perhaps something to think on.
I wouldn't take that for granted. Invested £20k last year in a S&S ISA (various funds) and 18 months later it's worth £19.7kGassing Station | Finance | Top of Page | What's New | My Stuff