Active discussions

Meet the Other Phone. Child-safe in minutes.

Meet the Other Phone.
Child-safe in minutes.

Buy now

Please or to access all these features

Talk
AIBU?

Share your dilemmas and get honest opinions from other Mumsnetters.

Original poster

To ask about life with no rent or mortgage....

213 replies

broadstairs14 · 10/12/2018 18:06

I'm in the fortunate position of being a "homeowner". If I look a little more closely, the bank owns much more of my home than we do. DH and I have had a lot of discussions recently about trying to get our mortgage paid off early and being mortgage free really appeals.

I know two people in real life who inherited/ were gifted money at a young age and owning a house outright seems to have given them a huge amount of freedom and choice.

If you are mortgage free and still on the youngish side, how does this affect your life? Is it worth making sacrifices in other areas and really pushing for this? I'm looking for some inspiration to spur me on but also worry that I might be building it up and maybe it doesn't have such a huge impact all of the time.

OP posts:
immortalmarble · 10/12/2018 18:06

I don’t think it’s made much difference to be honest as other bills obviously still need to be paid.

cloudtree · 10/12/2018 18:09

I thought it would make a massive difference to the way I feel. It hasn't really. But I guess that's because we paid ours off ourselves and so the monthly payment gradually got smaller. It is good though to know that the house is paid for and if financial disaster strikes we have one less thing to worry about.

I can see how if you have a windfall and suddenly pay off a £300k mortgage overnight that would make more of a difference.

Stinkbomb · 10/12/2018 18:09

Definitely worth overpaying as much as you can - saves you a fortune in interest if nothing else.
I am mortgage free due to buying houses which needed doing up, living in them and then moving on, and also overpaying as much as possible - if I ever got a payrise etc I would increase the payments as much as I could.
It means that I have the security - I don't need to worry about remortgaging, negative equity or anything else like that - it's such a relief.
I can also save more towards retirement and the future.

december212 · 10/12/2018 18:12

Also aiming to mortgage free fairly young. Knock on effect being that I hope to save enough/put into pensions after the mortgage is paid to be able to retire early, say 50. Although I'll still have other bills, they're much individually much smaller than the monthly mortgage cost.

Original poster
broadstairs14 · 10/12/2018 18:13

Thanks for the replies so far. I agree it would feel really huge if we suddenly got a lump sum (unlikely) and could just clear it overnight. We are looking more at trying to really focus on clearing as much of it as we can as soon as we can. We have decent salaries so it is feasible but I do wonder if the short-term sacrifice would really be worth the longer term gain? I'm thinking of a goal of being mortgage free by 45 which I'm convincing myself is still relatively young!

OP posts:
Botanica · 10/12/2018 18:14

At high interest rates it is a hugely advantageous position to be in.

At low rates it could actually work in your interests to keep your mortgages and use the money you would have paid off to generate additional income elsewhere.

Shepherdspieisminging · 10/12/2018 18:15

This reply has been deleted

Message withdrawn at poster's request.

Mumof1DS · 10/12/2018 18:18

Something I dream of Grin OP are you on the money saving expert forum? It has a very active "mortgage free wannabe" forum and is full of like minded people.

Botanica · 10/12/2018 18:18

I should add I used to be a massive advocate for overpayments and clearing early, and I have done this on several previous properties (I am 40).

However, I'm now choosing to maintain mortgages at 60 or 50% LTV and use the money to make other investments.

When the mortgage terms come up for renewal, if the interest rates are still low, you can remortgage back to the original LTV and take the difference as a further investment or income.

All depends on your comfort levels when it comes to risk and security.

DrDreReturns · 10/12/2018 18:19

I've been mortgage free since I was 35. We save what we used to repay to the bank. Day to day it hasn't changed my lifestyle but we've got a bigger safety blanket if one of us ends up out of work.

LakieLady · 10/12/2018 18:19

We overpaid for years. When I got to 60, the lump sum from a (very small) occupational pension was more than enough to clear what was left, so we paid it off. It made financial sense: we were paying 2.1% on the mortgage and only getting 1% on the money in the bank.

Not having to make that payment every month has made it possible for me to reduce my hours by over 50% without too much of a drop in disposable income. If I still had to work full-time, I'd be shattered. And miserable.

Botanica · 10/12/2018 18:20

@Shepherdspieisminging I would say it depends if you're in a rising or falling market.

In a rising market you'll make more in capital gains by being in a larger house sooner. In a falling market, minimise your losses by staying in the smaller property longer.

ProfYaffle · 10/12/2018 18:27

Our circumstances are pretty unusual. The critical illness insurance paid off our mortgage when dh got ill. We were 33/34 at the time.

We chose to stay in our smallish house because we valued the peace of mind knowing that if dh got ill again we wouldn't lose the house. When he did have to go back for further treatment in subsequent years, him having no salary for a few months was quite easy to cope with.

It's enabled me to be a sahm for 12 years (back at work now though)

We've a bit older now, being mortgage free means we can plan to both go to part time in our mid 50s and have a long semi retirement.

Alfie190 · 10/12/2018 18:28

We paid off the mortgage when I was 43 and DH was 39. We didn't get a windfall, we set ourselves an 18 month goal and I tracked progress every month? We didn't over pay, we put it into a savings account and then when we had enough plus a bit more to spare we rang up and paid all at once.

I don't think it has changed life on a day to day basis, but it does give us a bit of peace of mind in case something happens job wise and also flexibility, for example I took a year off for FT education this year.

december212 · 10/12/2018 18:30

Overpaying was definitely great as when I went onto mat leave, there was a but of leeway to drop the payments right down (obviously undoing some of my previous overpayments). Thinking longer term having that sort of cushion would be handy if I were to be ill or not able to work for whatever reason.

Mse mortgage free wannabe has some great tips, as pp has said!

VickyEadie · 10/12/2018 18:31

I was fortunate enough to be able to be mortgage-free at age 41 (sold London property, moved to somewhere much less pricey, met current partner who had been savvy with property, both had well paid jobs).

It's been fabulous. I'm now 60 and it meant I could give up my very stressful (that very well-paid job I mentioned earlier) and do what I really wanted to do.

Original poster
broadstairs14 · 10/12/2018 18:32

Some interesting points here about reducing the LTV or not overpaying so much while interest rates are low. This is the thing, I'm not sure how much of it is psychological rather than strictly making the most sense. The idea of simply owning a property outright, here and now (well soonish) rather than at some distant date when we're basically retired anyway. I have indeed had a look at the mortgage free boards over on MSE but they tend to be quite one-sided in how they view it. I guess I'm struggling with the thought of so many years of paying this mortgage off. It's got more than 20 years left in it.

OP posts:
newplacenofriends · 10/12/2018 18:32

I think the amount to which it is freeing depends on the house of the cost. Paying of a 500k house earlier will free up at lot more money than a 50k house

Ragwort · 10/12/2018 18:34

We became mortgage free in our early 40s, the main reasons were by staying in our ‘first home’’ for quite a long time when all our friends were buying bigger properties, deliberately only having one child, and moving to a less expensive area. Obviously those decisions wouldn’t suit everyone but it worked for us. We then managed to buy a smaller property as a buy-to-let, and paid off that mortgage, so we have an income from that in retirement (& yes, we are responsible landlords & haven’t increased the rent in 10 years, same tenant, & always redecorate, replace white goods etc.)

BoringSoup · 10/12/2018 18:35

Dh and I have been mortgage free since 2003.

We were in our late twenties/early thirties when we paid it off, and it was a fantastic feeling when we did.

We spent a good few years saving up to put money away to pay it off, no holidays, driving old bangers, drinking cheapo supermarket beer, staying in, full time plus overtime on top, so we were too tired to go out out anyway.

It was hard, but well worth the sacrifice.
Plus, once we paid it off, we poured even more money into our private pensions, so will be semi retiring within the next five years

These days, we can afford to go on nice holidays, drive decent cars, and buy nice things without worrying.
But the best thing is, we own our house. And we are immensely proud of that.

Original poster
broadstairs14 · 10/12/2018 18:35

Ooh some great stories (though not having the mortgage paid by illness cover obviously- profYaffle I hope your DH is doing well). Alfie190 if it is not a terribly impertinent question could I ask how much you had to save in 18 months to pay it off?
Part of the issue is that I feel we are quite late in life already to be as mortgaged as we are. My parents generation bought houses at 25, we were pushing 40 and it seems so bloody late to be saddled with it (lucky though we are to have it at all, I am hugely aware of this).

OP posts:
Original poster
broadstairs14 · 10/12/2018 18:37

Boringsoup wow, to be mortgage free so young and on your own steam.... It took us so long to even get on the "ladder" in the first place.

OP posts:
BoringSoup · 10/12/2018 18:37

Actually no, I got it wrong, We were mid thirties when we paid it off.

allthgoodusernamesaretaken · 10/12/2018 18:37

With interest rates low, I'd say this is a good time to pay off as much as you can. That way, if / when interest rates go up, you will be paying interest on a lower debt

BoringSoup · 10/12/2018 18:39

My apologies @broadstairs14.
We were still young mid thirties though.