greent's mfw journey

A question about : greent's mfw journey

Afternoon all!

I have been inspired after reading lots of the diaries on here to join in.

Background: OH and I are both 40. Have 4 children (12, almost 10, 4 and 10 months) OH was made redundant twice last year and recently started working as a contractor on a daily rate (4 month contract, may be extended a little) - so we now have a limited co of which we are both directors. I no longer work. We have a BTL property on which we have an interest only mtge and will clear that by selling the property (only bought for capital gain, not income, purposes) BTL property has long term tenant in. Rent covers mtge and buildings insce and repairs/ renewals with a small excess - but not much.However, it's on a fixed rate and takes care of itself.

MFW relates to our home. Bought in Oct 2005 for 277k, 130k mtge over just under 16 years (kept previous end date) Since then we have added a further 30k to the mtge for a loft conversion (needed due to the no of children!!) that cost approx 35k. We have also spent 20k+ on a bespoke fitted kitchen and building work - but financed that from savings/ income. And decorated and new carpets (previous owners ran out of money and had to sell, so place was full of stuff to do, even though it's still only 11 years old!) Some overpayments have been made, as can be seen from the overall balance.

OUr mtge is with C&G. I have a statement for balances as at 31/12/09:
(Balance as at 31/01/2009 was Ј124 616, so we reduced the balance by just under 20k last year)
Sub Account 01
Term remaining 12 years and 7 months.
Fixed rate 4.79% - until 30/09/10
Balance Ј79512.27

Sub Account 02
Term remaining 13 years 1 month
Fixed rate 3.99% until 30/04/11
Balance Ј25423.78

Sub Account 03
Term remaining 12 years and 7 months
Fixed rate 4.79% until 30/09/10
Balance Ј33.32

TOTAL BALANCE: Ј104969.37

We can repay by 10% a year without incurring penalty fees. We pay Ј1074.94/ month - this includes an element of overpayment, but I'm not sure how much (we didn't reduce our monthly payments when we paid off Ј12500 after DH was made redundant the first time)

My first step is going to be repaying Sub Account 03 We are with C&G, so I will phone them up about this. I can also afford to repay Ј4k to Ј5k from sub account 01, I think - but will leave that until after a meeting with our accountant (we are not sure yet exactly how much OH will be paid from the linited co)

I'm kind of looking for advice/ ideas, I guess... Would posting an income/ expenditure budget be an idea?

greent

ETA: We don't have any other debts. CCs are used (Tesco ones for Clubcard points for rewards) but are paid off in full.

Best answers:

• With your OH recent work history I would keep a good emergency fund of up to Ј16K in cash ISA,s if possible.
  How long has the fixed rate deal on the BTL got left ? a lot of BTL lenders now want you to have 25/30% equity.
  Dont pay ERC,s on sub account 3 just wait until end of fix ! better to OP 10% on other parts
• Thanks for your comments.
  We currently have about 8.5k in cash ISAa and will put some more in in the new tax year. We have 20k in an online savings acct and another few k in an instant access low int acct linked to the c/ac (I need to review our banking arrangments - is one of the things on my 'to do' list)
  ERP on Sub acct 03 is less than the int I'll be charged between now and the end of the fix (it's really tiny - about 30p), so I'm still planning on doing that
  The fix on the BTL runs out v shortly (May, maybe) and reverts to SVR -payments on it drop by about Ј45/mth. Equity is fine - mtge is 65k, properties in that street usually sell 100-110k. I wouldn't expect ours to sell for more than usual, but would hope that because it has new windows/ doors, new heating system, new carpets and a new bathroom could mean an easier sale than a neighbouring property without these. However, I'm not looking to sell it for about a year - so I'm also not looking to get a new fixed rate on that basis, either.
• Long term after you fix on account 2 ends have a look at offset mortgages if the rates are good.
  Keep up the good work
• Have set up financialbliss's spreadsheets for sub accounts 1 & 2 - brilliant! Great to play with the figures and see the difference it makes. We are on target to totally repay 24 months early at the moment, which is great.
  Will update as and when I make OPs. My first target is to get the balance sub 100k
  greent
• Right, after dithering about this I finally got my act together today.
  I phoned C&G and have repaid sub acct 03 in full - all Ј32.68 of it, including a 32p ERP - this is less than 3 months' interest, and fix expires in Dept, so am happy with that.
  I have also increased our monthly pymts from Ј1074.94 to Ј1150 - this extra will be coming off sub acct 01, the largest one with the highest int rate.
  Having put the figs into my spreadsheets we are now due to repay the mortgage in May 2019 - yeay!
  Next target is to get balance sub 100k - hopefully in may or june. Ultimate target is to repay mtge by Aug 2016 - eek!!!
• We're off to Cornwall for a week tomorrow - cheapy deal - 6 of us in a mobile home, but should be good
  Anyway, Sunday night (so day before Bank Hol) DH asks if I'll phone up the local garage on Tues to book car in for a service for Thurs (yesterday) - 'it's been sounding a bit funny' (this is from the man who took my (old) car to Birmingham and back with no oil and terminally damaged it last year ) OK - I duly did and they had space (thankfully)
  Car service was Ј114 ish - that's ok. However, the gearbox is going - that'll be Ј2800 + something - eek!!! It's DH's ex company car - we bought it when he was made redundant. It's a 56 plate Ford S-Max with 66k on the clock - all the miles done by us and regularly serviced when company car and twice serviced since we bought it 11 months ago. Not ramped. It would still be his co car if he still worked there - they have a 4year replacemenmt policy.
  Bang goes me making a large reduction in one go in May/ June The garage have even said that we shouldn't be taking it to Cornwall, just in case. However, as my car is a Golf and there are 6 of us, we don't fit in my car as a family!
  Am all up in the air what to do now. Plans out the window. Need to be packing (and sorting stuff for DS1's bday which is next week whilst we're away) but am down in a hole Also, my Clubcard Deals vouchers (ordered on 26th March) for Eden Project and Flambards haven't arrived
  argh!!!!
  greent
• Big (HUG) greent
• Quick update on the car: it lasted fine for Cornwall (we took AA (with quidco, of course!) and used them on the last day - the car wouldn't start as teh battery was a bit flat (probably because the sat nav, ipod and 3 x ds were all plugged in whilst we were packing it with doors open ) Anyway, went to local main dealers yesterday and they would charge Ј2900 to do the work. They have also offered us Ј9.5k part ex for it for a new/ almost new s-max or galaxy (and they'll obviously pick up the charge of the work) They have a customer desperate for the spec that we haved on our s-max. We paid Ј9k for it a year ago almost to the day. It's tempting to look at a 1 year old galaxy - more room for the ever growing 4 children. They're looking at what they can come up with today.... May end up spending more money - eek!
  Have opened 2010/11 cash ISA for me. Need to find DH's online login to open his
  And on the good news front, DH received notice that he's entitled to a 2009 bonus of about Ј2300 from his old employer (left a year ago) - yeay! Unexpected
• Wow I am always in envy of people who have so much savings and money here there and everywhere.
  You also have an amazing LTV ratio.
  I am in awe of your achievements so far
  x
• Thanks, pammyj74 . I was worried that our LTV had been hit hard by the recession and fall in house prices, but saw the same house as ours (but without the loft conv and with the original kitchen and 1 less reception room) for Ј320k, so I'm figuring that ours should be ok at min 300k, giving us a good LTV :-)
  We bought our first house in 1991 for 42k with a 40k mortgage and sold in 1996 with negative equity We had savings tio cover the neg eq, but it meant that we took a 100% mortgage on our second house of Ј68750. We sold that in Oct 2005 for Ј182.5k and had a mortgage of about 36k at the time - so had good equity to buy our current property, thankfully!
  Our savings are mainly at their current level due to OH's redundancy payment a year ago..... We also have too much money tied up in some Bank shares.... They are worth less than we paid for them, so I'm thinking that if we want to sell, selling them in the same tax year as the BTL property could be good, as they would have a negative capital gain to offset against the capital gain on the BTL for tax purposes
• Quick update. I've joined the 2010 MFW thread - yet to post (will do tomorrow) and have already amended target from 15k down to 10k OP for the year - mainly because we have bought a new car for OH.
  Come May I'm on an ebay mission - have been tidying garage and found things to list - and will put payments received on the mtge as OP at month end Shall look to do this (hopefully) on an ongoing basis, together with other monies we manage - need to redo utilities as a start (currently Ј166/ month for gas & elec!!! eek!)
• I need to do a bit of ebaying this month as well, Have a few of the kids old school uniform to put on there but seems so does every one else lol
  good luck with it all x
• Good luck... keep persevering
• Quick update - today our increased mtge pymt went out, so that's an OP of Ј255. I have listed 5 things on ebay - only weeny things all at start prices of 99p. I keep trying to download turbo lister, because I hate having things ending over several different days (I'd rather make one or two trips to the PO after a mass ebay session than every other day over the month) (the PO is next to Tesco - too tempting to nip in there and buy unnecessary things!!) I'm going to sit down again later and see if I can give it another go. It's on the desktop pc, but that's so-ooo slow and I can't get it on either laptop. If I am successful, I aim to list 5 things/ day on turbolister (if I can find that many things I don't mind going for 99p, as I don't want to pay listing fees!) and then upload them to ebay say once a week, I think.... Shall see.
  I currently have Ј200 put aside to OP at the mo - want to build it up to Ј500 before doing so, if I can.
• good luck for your little ebay challenge, I have just set myself to put 5 things on this week. I have 4 things to post and its just finding the time to do it and send them grr
• OOh - a free listing weekend on ebay this weekend - means I can list some bigger items!
• I save them for these weekends too lol, hope you get some sold x
• Good Luck with your selling
• Quick update from me
  DD(aged 12) has been told she needs braces for her teeth but isn't eligible for NHS funding (Needs to be a '7' to get funding, she's a '5-6' That'll be Ј1675!!! Think that might slow up my OPs
  Have 12 things listed on ebay (all 99p start, so free). 1 watcher on one of the 3 books, but someone is interested in all of the other 9 items - so I'm hopeful that they'll buy them , along with maybe a few of the other (similar) things that I emailed them with that I'm planning on listing this weekend. It won't come to much money, but the money/ decluttering are equally important. I'm still going to try and save ebay monies towards OPs - we'll see how we go!
  Have tried repeatedly to phone tax credits for a claim form (DH used to earn too much but now doesn't) - after being on hold for around 20mins+ each time without even speaking to someone I keep giving up because inevitably one of the children needs me/ is crying etc - grr!
  Popped into town this morning to go to 4 banks/ financial institutions and do various bits and pieces. Resisted the very yummy cakes at the farmers market (and the other yummy snack foods). Got a free cup of tea from McD (voucher) instead. Bought the 3 largest chickens that I could find in M&S (3 for Ј10 deal) and have squeezed 2 into freezer, 1 in fridge for Sun. Did buy a box of Maltesers in the Ј1 shop, though - thought we could eat them with Dr Who tomorrow (we all snuggle up on one sofa to watch)
  Ooh - have started recording gas/ elec consumption. First readings last Fri at 6pm, so will take another set tonight. However, have had heating on a couple of times this week (it's cold whenDH gets up at 5.30am!) and tumble drier yesterday (sick child= washed bedding and rainy weather)
  Have joined May'#s make Ј10 day challenge and will put towards OPs. Need to start doing surveys/ daily clicks etc again - have been very lax about this of late