ATB's Ј171k quest begins.... NOW!

A question about : ATB's Ј171k quest begins.... NOW!

Hello fellow MFW'ers,

Well this is my first proper post on this board, I flitted onto it many years ago but then life, two children and two businesses managed to take over!

My title says it all really! I have been inspired by many of the wonderful posters on this board, and am applying my philosophy of reaching for the moon, if I fail I will land amongst the stars to my mortgage. A little about me and my aims:

I am 29 years old, married for 5 years to DH, with two small children (DD is 2 and DS is nearly 1). DH and I are both self-employed - myself in the legal sector and himself is an engineer. There are massive peaks and some major troughs to us both being self-employed, but on the whole we love it and wouldn't swap it for regular employment.

We moved to our current house 2 years ago to accommodate our growing needs, and it suits us down to the ground. We had to take our mortgage over 30 years due to us both only having been self-employed for a short period of time at that point with limited evidence of income. Clearly there is NO WAY we are paying this off until we are nearly 60!

So, our plans are ambitious, but we both love a challenge and if you don't try you will only ever fail, right?!

Current figures are: Total outstanding on mortgage as at today's date: Ј171,064.24 with 28 years left to run.

The Grand Plan - pay this off by in 5 years just before my 35th birthday.

I know it sounds bonkers, and many may scorn our plans which is why we are not telling anyone in Real Life what we are doing. I have spent a long time reading diaries on here (big thanks to Watty and LauraJo who have inspired me without knowing it!), so please pop on here and support me if you can.

How do we plan to do this? It is simple. By living as frugally as we can, whilst still retaining some semblance of a life. I have also applied for a 0% card so I can be a stoozer which will help a little of the way.

Back later with more information, the littlies need lunch xx

Best answers:

• Welcome to MFW!
  We're quite similar in more ways than one. Im 27, two children (well nearly - bump growing!), had Ј155k on mortgage and its running for another 30 years.
  Our mortgage is now at Ј127k so I can say chipping away certainly makes a difference! . We're hoping to be mortgage free in 5 years too.
  All the best with your journey xx
• Very good luck to you. I wish you lots of fun along the way x
• I have a rather large mortgage too..started making overpayments last month and I am keen to continue to do so.
  Take a look at the overpayment calculator on here it shows you how many years you can knock off.
  It does take commitment but reducing food bill, checking utility suppliers, need not want debate in your head before you buy something all helps .. good luck x
• Wow! Will subscribe and follow you!
• Hi everyone,
  Thank you so much for the kind comments and welcomes. I am so excited about this challenge and have set myself off the starting blocks today by making an overpayment via online banking of Ј64.64 - random I know but it will temporarily make our mortgage a nice round figure haha!
  My February aim is to make OPs of Ј2,500. This will be made up of (hopefully) my income (DH's wage covers all the direct debit bills), and some money that we lent to a friend which they will be repaying to us shortly. I tinker around with the overpayment calculators all the time, it is definitely my new obsession!
  My DH is also working away a lot this month, which means that the food bill drops *A LOT*. I reckon we will save around Ј100 on food as a consequence of him working away, so this will go onto the mortgage.
  All the small bits of "income" will also be applied to the mortgage as Ops, for example I have two small things to return to Next tomorrow, which will refund Ј16 to our current account which will go straight to the mortgage.
  So as you can see there is nothing grand or dynamic about our plans, just some good old-fashioned budgeting, common sense and supreme organisation xx
• You've really inspired me. I plan to get my credit card paid off this pay cheque (Ј300) get Ј2k savings (4 months of essential bills) - that's Ј500 still to go and then it's mortgage time. Ј112k to go - I'm already overpaying by Ј30, not much, but it's a start. I'm going to start saving the pennies in a pot and then paying them off the mortgage each year. Here we go!
• Hi ATB!
  I'm going to subscribe to your diary, as our balances and time left are pretty much the same on our mortgages, although our circumstances are different (at the moment it's just me and DH, although we are hoping this will change in the next few years...) I'm intrigued to see how you get on, and if we can follow suit!! We are currently looking at making minimum monthly OPs of Ј500, with the hope of being paid off in 14 years (14 years earlier than planned).
  The 0% balance transfer card you've applied for, does it come with benefits such as points? I know a lot of people use the Tesco one for points which they then exchange for restaurant vouchers, therefore giving little treats as well as saving money!
  Have you looked at your energy supplier and if they are the cheapest at the moment? We are in the process of switching, we used the MSE cheap energy club site to compare, and should save Ј320 a year, which will go into overpayments!
  Have you switched your bank accounts recently? Last year DH and I both switched our accounts to Halifax, and got Ј100 each, which went off the mortgage. I also switched an old, unused account to M&S just before Christmas to get a Ј125 voucher (think it's now reduced to Ј100) which helped with Christmas costs, and I've still got about Ј50 left on it.
  I'm an avid user of cashback websites, and any cashback I earn goes straight into the mortgage account. Our bank account also offers cashback with certain retailers, so all that goes in too!
  Recently, I've been cheekily emailing companies and asking for free samples, or vouchers to use on their products. I've been successful with a couple of tea companies, a couple of cosmetics and a cleaning product company! I was shocked, and think I'll keep doing it-it's nice to be able to try new things, or have a little treat, and even better when you don't have to pay for it!,
  Good luck on your journey-I'll be reading with interest!
• Good Evening everyone,
  We bank with First Direct, they are fantastic so I have no plans to switch. The monthly budget has been done, and we have been repaid by our friend so Ј1,050 has been paid off the mortgage (the extra Ј50 was simply to make it sub Ј170k hehe!)
  So I need to find another Ј1400 to meet this month's overpayment target. I am hopeful that my income will make up Ј1k of this, I will have a better idea by the end of this week.
  DH is working away so its just me and the tiddlers at home this week x
  ETA - Laura thank you for your message. I have been accepted for an M&S card so will accrue loyalty points, and I also get a Ј30 gift voucher immediately. I don't use Tesco as I dislike their business principles and ethics - I'm Ocado through and through x
• That's a fantastic overpayment!
  That's great you are moving to a card with points and a bonus voucher! I personally don't have a Tesco card but use a John Lewis/Waitrose Partnership card in order to claim points towards vouchers, but I am aware that a lot of MSEers go for Tesco as it has the option to 'double up' for treats. Trying to persuade DH to do something similar to earn points, as he makes a lot of big purchases on his credit card & pays in full, is however rather difficult!
  If you have good customer service at your bank that's brilliant, it can make such a difference! DH & I both banked with HSBC before, and were shocked at how much better we have since found the customer service with Halifax. It wasn't that HSBC were bad-just that we found Halifax to be noticeably more customer focused in our local branch.
  Good luck making up the rest of the overpayment!
• Good Evening All,
  How is everyone doing? I have been tinkering around with the payment calculators again, and to reach my MF target we need to overpay Ј2,500 per month. Good job I love I challenge! x
• A brief but super positive update from me - we have smashed this month's overpayment target!
  Mortgage today stands at Ј168,000 exactly! I am so pleased! (if my smilies worked I would use them, unfortunately they don't for some reason). The rest of the month will be a little tight, but I am confident I can get us through to month end with just the cash in my purse (Ј80) and no need to use the debit card.
  My new M&S card arrived, which I am going to use for stoozing purposes from the start of March.
  I also have a call out to our mortgage adviser - I think we could perhaps get a better deal thereby reducing our interest rate and freeing up some more cash for overpayments. He really is a smashing chap and we don't pay a fee to him, he gets a fee from the mortgage company, so as far as we are concerned we get a free service from him.
  We are with the Halifax on their SVR of 3.99% at the moment - I am certain we could get better with our current LTV of approximately 75%.
  Keep at it peeps xx
• New mortgage deal secured - 2.69% fix for two years. The only problem is that we are capped at 10% overpayments per annum, however we will meet that limit each year then stash the rest in savings to hopefully make a big enough overpayment at the end of the two years to bring us under Ј100k x
• Happy Sunday everyone!
  I hope everyone is doing well. We have today paid a Ј300 OP which will be our last OP for February. Nursery fees are due at the start of March which are always a crippler even though DS only goes 2 days a week.
  I should get confirmation this week if our rate swap will take effect before our payment date on the 1st of the month. Once I have this I am going to put together my plan, bearing in mind that OPs will be capped at 10% per annum for two years from the date the new deal kicks in. The rest will be locked away in the best savings account we can find until the two years has expired, at which point we will make a big OP of the money we have been saving. Or so the theory goes.... wish me luck! x
• Great job on OP you must have saved a lot in interest with that payment :]
  I think its good you can save the rest and only pay 10% give you options at the end of the 2 years
  I myself am charged at 3%/ 2% booo for the first 2 years so am going to wait 2 years and pay off as much as i can after that time which i think is the best way got an account called mortgage fund :]
• Agggh I need advice guys.
  The paperwork has been emailed over for us to sign for the new deal. Trouble is I'm really worried that the 10% per annum OP cap may thwart our plans.
  The principle of meeting the 10% limit (which I know we can do) then saving everything else and making a big OP at the end of the two years sounds good, but will I be disciplined enough to save it and not touch it? So do I stay on 3.99% and make unlimited OPs (to meet our MFi5 target we need to pay off circa Ј3k a month) or sign up to the two year 2.69% fix and OP much less than that whilst theoretically stashing the rest to make a big OP in two years?
  What would you do guys? X
• Have you thought about reducing the term of your new mortgage deal. This would increase your normal monthly payments and still allow you 10% overpayments. A lot of people on this board do it...seems to be a bit of a loophole.
• Thanks for your comment WABL. That would have been my ideal but as I have only been self employed for a short period of time, we would not get past their affordability checks as they need three years accounts and they do these checks as standard when you ask to reduce the term.
  Any other thoughts guys? My gut tells me to stick with the higher rate and hammer at the OPs... Xx
  ETA... Just checked online banking and a customer has paid me early so I've paid that straight off the mortgage - Ј400 down :-)
• Personally I would def switch mortgages- on your current rate you will pay about Ј6703 in interest in a year and new rate would be Ј4519 so a saving of over Ј2200 per year in interest. That is a quick calculation not taking into account payments made (I'm not that technical!)
  Could you look at an account where you have to give a notice period of say at least 30 days (to make you really think about whether you want to spend it) or one with just a branch passbook?
• Id definitely get onto the lower rate. I know the 10% cap can be annoying but many of us are in the same position . Open up a savivings account or something with your chosen bank and put all the acsess money in there untill your fixed rate is up - will take will power not to touch it but im sure you will manage. Imagine the day you get to make that huge overpayment!! xx