Things are ticking along with the mortgage payoff. We’ve continued with a small overpayment every month and dh is talking about putting his next potential {small} pay rise towards increasing the overpayment.

The figures as they stand today are:

• Mortgage Balance: £117,799
• House Value £180,000 {approx}
• Monthly Payment £542.34
• Monthly Overpayment £57.66
• Payments left 240 {20 years}

The interest rate for the time being continues to be low {0.99%} although I’m not so sure how long it will stay like that; also for now the mortgage payment is on par, if not a little cheaper, than any house we could rent for a family of four in our area.

There are now only two years until we move abroad and it’s impossible to plan what will happen at that time, so for now I’m just looking at the mortgage as debt, debt that I want gone; making small overpayments makes it feel like we’re making progress.

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{photo credit: therichbrooks}

If you’ve been reading this site for the last few weeks you’ll probably know this already, but after thinking for a long time that we would rent our house out when we move abroad, we have now decided to sell it.

There are a few reasons why we are doing this, the main one being freedom; we want the ability to choose where we live, just for the short term, and we want to experience mortgage {debt} free living for a while; I should say I’m not against mortgage debt, and I’m sure in the future we will have a {small} mortgage again.

Other reasons; we don’t want the hassle of renting a house out in a different country; we’ve read too many problem filled stories. Also at the moment neither of  us utterly convinced that home ownership is the be all and end all, something recently confirmed by a matter affecting my mum and step dad; I don’t want to get into the environmental for’s and against of this subject but from a purely house ownership angle it’s not good. After living in their house for over 30 years they are now faced with high speed trains going past their back gate and through land they use for {income producing} haymaking,  if they wanted to, or needed to sell, it would be impossible at the moment, the planning etc is going to take months/years and residents are trapped.

So, please let me know your thoughts, good or bad

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{photo credit: padawan}

I don’t mind admitting that I’m all over the place with my decisions about owning vs renting a home. I love the idea of being totally {mortgage} debt free in a couple of years and renting in Portugal until we find our ‘right’ area; however I do wonder if someone who loves her home as much as I do could be happy in rented accommodation forever!? {I’m also harbouring a dream about running a simple b&b in Portugal, something I always seem to come back to, and this would mean owning} Decisions, decisions.

Anyway our current mortgage is reducing every month and we’re still making a small overpayment; £57 every month. We’ve had some windows replaced and are now getting quotes for a new back door/entrance way; all work that needs completing before we sell. Our mortgage balance is now sub £120k and it’s great that it’s below another milestone.

PS. Something I realised when searching for a photo to put with this post: I LOVE yellow houses!

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{photo credit: daryl_mitchell}

I don’t consider mortgage debt to be bad debt. To me, and this is my personal opinion, owning a home is the best way to go financially {as long as it’s not a great big massive home that you can’t afford!} and owning that home outright, with no mortgage, must bring an amazing feeling of security. That’s why I {we} want to be mortgage free. Saying that though mortgage debt is still debt and we want it gone.

With all the happenings with work etc last year, our plans to be mortgage free in 2012 went off course, so we’ve made a new plan. 2020 is the new target; ten years to pay off £120, 582. {Mr Move To Portugal will be the big 40 and I’ll be 103, but we don’t worry about that!!}

We need to overpay by approximately £500 a month to hit our target, and this will take just over 10 years off our mortgage term.

Futher Reading:

• Rent of Sell
• 2009 in Review at Death To The Mortgage

 {photo credit: sunfrog1}

Financial freedom means something different to everyone, and everyone has a different set of circumstances; this makes it difficult to offer any advice on the subject; all you can ever do is let people know what works for you.

There are several financial gurus out there, Dave Ramsey and Martin Lewis to name just two, who all offer great, but different ways, to get yourself sorted financially; they all offer differing advice on the steps to take, however there is always one step from every guru that is the same, and it’s a step that worked for us; pay off your consumer debt.

Not holding any consumer debt is the best foundation to financial freedom ever, any steps you take after that are all good, aren’t they? Whether it’s saving a large emergency fund, saving for retirement or paying off your mortgage, it’s all going the right way; towards your financial freedom.

What about you, what’s your financial freedom priority at the moment?

{photo credit: zanzibar}

I’ve hardly mentioned the mortgage this year, probably because we stopped overpaying it and concentrated on building an emergency fund. However it’s time for a re focus as we’re starting to make {small} over payments again next month.

The current balance is £121,581.65 and we still have 20 years and 8 months to make payments! Originally we had hoped to clear this balance by 2012, however due to work situations changing {all the bonuses got stopped!} we changed our goals and our priorities. We still want this debt gone though!

Anyway, from December we are making a small over payment of £57 a month, which will bring the monthly payment to £600 and reduce the term of out mortgage by approximately 2 years. In the new year any extra money we make, above our budget, will be split 50/50 between the mortgage and our travel fund. When I get a new job, all my earnings will go into these two pots. If we can at least up the overpayment to £100 in the new year, this will reduce the term of the mortgage by 5 years; it’s amazing what even a small overpayment can do to your term.

Mortgage Snapshot;
Mortgage New  Pyt   Act Pyt  Int       Balance
1st Nov £542.34 £542.34 £102.60 £121,581.65
1st Dec £542.34 £600.00 £100.00 £121,081.65
1st Jan £542.34 £600.00 £100.00 £120,581.65
1st Feb £542.34 £600.00 £100.00 £120,081.65
1st Mar £542.34 £600.00 £100.00 £119,581.65
1st Apr £542.34 £600.00 £100.00 £119,081.65

 Are you making any mortgage overpayments?

 {photo credit: Fr Antunes}

A little while ago I posted about how undecided we were on whether to rent out or sell our house when the move happens. We’ve finally made a decision, I think the photo probably gives it away!

We aregoing to rent out our house. There are a couple of reasons for this. Firstly, if it all goes wrong we still have somewhere to come back to, and secondly, if we don’t make anymore over payments, the mortgage will finish just in time for our planned retirement year and provide us with income. We do plan on making over payments, but if we don’t, then this is where we’re at.

Tell me what you think, is this the right way to do things?

{photo credit: p doodle}

I’ve not updated the mortgage/savings figures for a while, so here’s the up to date state of play. Instead of a 2009 mortgage overpayment target, we have a savings target, this is purely to give us some security. I’ve added new sidebar meter’s to reflect our new goals.

Mortgage: £125,074
Savings: £9,453
Mortgage Freedom: £115,621

2009 Mortgage Freedom Goal: Mortgage-Savings= £104,000

If you notice I’ve also added a Big Trip Fund sidebar meter. This is for Bucket List goal #No4. It’s empty at the moment but I’m working on it

Further Reading:
The Great Mortgage Payoff

An update on where we finished at the end of 2008 and our mortgage goals for 2009:

Our mortgage balance finished at £125,847 for 2008. We had the goal of £119,000 for the year end, which we’ve sort of achieved as we currently have £6,600 sitting in ISA’s.
We took the decision to keep some money back just to provide us with a some security in case something drastic happened with our jobs, now we are going to be saving not over paying for the time being, as our mortgage rate dropped to 2.49%.

Financially we are better off saving the money than paying off the mortgage.

This will obviously throw out my tracking, but I’m still going to update the freedom meter on my blog as the more we have in savings, the nearer we are to mortgage free living. The motivation to save is still the same as the motivation to pay off the mortgage.

Target year end balance: Mortgage – Savings = £104,000

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Hi all, I’m back from NY, which went very quickly, but was fantastic, and straight back to business -the mortgage.

The monthly payment went through, with a small overpayment of £101.92, so in all we made a payment of £900 this month, which leaves a balance of £126,273.

Next month sees the monthly Direct Debit go down to £694.80, due to the drop in interest rates. Our interest rate is now 3.49%, 0.49% above base rate.
We’re going to make a total payment of £900 January 1st, and then throughout 2009, baring disaster, a monthly overpayment of £1000 on top of the regular amount.