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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:
Dontsweatthelittlestuff · 10/12/2018 19:20

broadstairs thank you x and it did give him a little bit of peace knowing that financially his family would be ok.
If I had still had a mortgage to pay then we would have lost our home as I just dont earn or would be able to earn enough to pay off the mortgage we had and still pay the bills.

KanielOutis · 10/12/2018 19:22

If life goes to plan our mortgage will be paid off by our late 30's. I don't understand how people say it makes no difference. For us it will mean an extra £800 per month.

Original poster
broadstairs14 · 10/12/2018 19:25

I feel it would make a difference to us in terms of the mortgage payment itself but also psychologically, knowing that we own this house and that we have the freedom to do things like go part-time or take time out and not have that payment to make every month or the risk of the bank taking it if our jobs go tits up.

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picklemebaubles · 10/12/2018 19:25

Definitely good, though we've actually put the money into uni for our kids and pensions for us. It does mean we always have a cushion, though.

SiliconHeaven · 10/12/2018 19:27

I have a sense of security that I otherwise wouldn't. It's nice.

olympicsrock · 10/12/2018 19:29

I am 40 and we paid off our mortgage last year , thanks to overpaying the mortgage and finally a gift of £50k from my Mum. We could have done all sorts of things with that money but enjoy not having to pay the mortgage and saving all that interest. It felt good to know that we owned our own home outright and that it could never be taken away. Having said that we have just made the decision to remortgage 30% of our home to buy a holiday home. However that is something we could not have done if we still had a mortgage!

ForalltheSaints · 10/12/2018 19:29

Being mortgage free has enabled me to reduce my working hours to a four day week. So more time for helping elderly relatives and other things.

Botanica · 10/12/2018 19:31

@Aridane What investments generate a return of more than borrowing rates of interest?

You could borrow at 1.5% on your mortgage and invest that in a buy to let for example, yielding 7%+

Freedom70 · 10/12/2018 19:36

Nc’d
I downshifted and moved to rural France in my mid30s.
I sold one property, to finance my purchase here. I kept one more which I rent out in London, I am a good landlord, my flat has not been empty for 10 years, different professional couples as tenants.

It is amazing being mortgage free. I read a book called Rich Dad, Pior Dad about 15 years ago. It inspired me to build up assets, not liabilities.
I don’t waste my money, have a cheap car and spend my money on the things that matter to me like financing being a sahm and travel.
I will start a small business in a couple of years, not because I have to but I am in my late 40s and need to use my brain. I haven’t worked full time since I was 33 and stopped working completely at 37.

wentmadinthecountry · 10/12/2018 19:37

Ours was paid off by late 40s - married young, just upped it as we moved to bigger houses - but have a small loan on a place we've bought for my dad (they helped us out early on, time to pay back). It coincided with dd1 1 and 2 starting university. Nice to know we own a house that's worth a fair bit though, thinking about children and their future security as well as our old age. 54 and way off wanting to retire though - love my job! Work hard, play hard.

ChinchillaFur · 10/12/2018 19:43

Our mortgage has 17 years to go, but we are overpaying a lot to try to clear it in 7 years. Have you been on the Overpayment Calculator? It's brilliant to see how many thousands in interest you will save. We will be drinking champagne when ours is paid, and I will quit teaching and do something far less sressful.

House4 · 10/12/2018 19:43

Ours is fully paid early 40's.
Did this by getting on the property ladder at 21 (have bought bigger houses along the way), working hard all our lives, being very money savvy (inc small cars) and basically being lucky with jobs/pay etc.
We did not sacrifice many things that we weren't happy to though (as I said we have been lucky but we also don't spend much naturally).
So happy we did it but it doesn't feel as good as I thought it would!! Very proud of us though.
We paid the extra 10% off each year but kept the monthly payments the same. This way there were no penalties. Then a massive lump sum payment at the end when the fixed rate was up which came from our savings.
It hasn't changed the way we live.
I think it all depends on where you are in life.
If you have young kids then I would say focus on that and enjoy them.
If your kids are adults or no kids and you've been to all the destinations you've always dreamt of then pay it off.
You could try for a year and see how you feel. It doesn't have to be all or nothing.
I wouldn't trade my experiences and memories for paying off my mortgage early. You are still paying it with your normal monthly payments and will get there eventually.

Original poster
broadstairs14 · 10/12/2018 19:46

Thanks, so many interesting perspectives. I'm not sure if all these amazing stories of being mortgage free by my age is filling me with inspiration or filling me with envy though! Such an amazing position to be in! Well done to all who have managed it though.

OP posts:
holasoydora · 10/12/2018 19:48

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.

We could be mortgage free but this is what my DH has done.

Being sort of-mortgage-free has not made a huge amount of difference to me as we have still both needed an income to break even. I work in a part-time job I would have done anyway (combined with young kids).

DH however was able to take redundancy, manage on less income, take some time out and do something different.

Because our income is now lower we rarely overspend and I dream of £2K holidays!

Original poster
broadstairs14 · 10/12/2018 19:49

chinchilla that's a good point about your stage of life. Our DC are primary school age so past costing us a fortune in childcare, not yet costing us a fortune at university so probably a small window where we can focus on eliminating as much mortgage as we can!

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PurpleTigerLove · 10/12/2018 19:58

Ive never had a mortgage . We built our house without one. It took several years but we did it bit by bit . Moved in when we were both 35. Husband had been saving to build his own house since he was about 14 . I starting saving as soon as we were together about a year ( so 27ish) .
We have since bought several properties outright which we are renting. No mortgage means we can rent to tenants with housing benefit . The rent is being saved to buy the next property and so on .
We would like to invest in land in the future as property attracts heavy capital gains taxes upon selling .
My children will have a house when they need it . My eldest has some special needs so it’s one less thing to worry about .
Neither of us are high earners btw, just incredibly good with money . Drive old cars , no random nights away in hotels or meals out , holiday every few years as opposed to annually, cheap mobile phones etc .
I’d encourage everyone to pay their mortgage off as quickly as they can . The financial freedom we have is liberating.

Calvinsmam · 10/12/2018 20:01

Stability is so important to me.

We made the decision to stay in a small house and not have kids so we could pay off our mortgage.
We could pay more but to be honest we like going on holidays and whatnot so we have a good balance. If things stay the what they are we should be mortgage free in 7 years when I’m in my late thirties.

Botanica · 10/12/2018 20:03

@Freedom70 I also second Rich Dad, Poor Dad. Read that in my early 20s and it changed my whole outlook on life, wealth and the world of work...

DoraJar · 10/12/2018 20:09

Unfortunately not on the youngish side - I am on track to be mortgage free by 60 at the latest and can’t wait! This will be 7 years after taking out the mortgage. Wanting to pay off by then made me go for higher paid jobs leading to me setting up my own business and now working overseas - so have also taken some risks and having fun!

Everyone I know who is mortgage free says the relief is worth overpaying with a vengeance! I should be able to semi retire - so can’t wait! Good luck

Mouse510 · 10/12/2018 20:09

While we haven’t paid our mortgage off, we own more than the bank does by overpaying every month and also paying in lump sums as and when we can (some inheritance and gifts). The terms of our mortgage allow us to withdraw from our overpayments if we want to and we have done this once. Every time we’ve paid in a lump sum we’ve opted to reduce the monthly repayments as that what suits our life at the moment and it’s a better rate as such than we would get in a savings account IYSIM.

PurpleTigerLove · 10/12/2018 20:11

Rich dad , poor Dad is a super read . Common sense really but so many people see their primary residence as an asset when it is purely a liability,it only becomes an asset when it’s making you money each month .

Plantflavours · 10/12/2018 20:25

We bought our house with an inheritance in our late twenties. It isn’t worth a lot compared to many on mumsnet, but was still a real struggle for us on a low income. Having no mortgage was life changing for us. Being able to go on days out with the children without fretting about whether we can afford it, having a holiday in a cottage instead of my parents caravan... I’ve been able to afford driving lessons, spend money doing up the house and pay for the children to join extra-curricular clubs. We are still on a low income compared to most people on this thread, but this lifestyle was completely out of reach for us before. We had no money for anything extra. I’m not working at the moment, but that will hopefully change soon and I can’t really get over how much money we will then have once our bills are paid. We’re not exactly big spenders and are very financially cautious so I suspect we won’t know what to do with it all! We may want to move to a nicer area in the future but I don’t like the idea of having a mortgage again. The security of knowing that you own your home is amazing. I feel lucky every day.

Mummyshark2018 · 10/12/2018 20:27

I think some of it is relative. You could be mortgage free on a home worth 150k or have a 150k mortgage on a home worth £500k. I know what position I would rather be in. I could've been mortgage free 10 years ago at 25years old had we moved somewhere cheaper, but we're just about to increase our relatively small mortgage for an 80k extension. Luckily we can afford to increase the monthly payments so there will be no change to the length. Hopefully be mortgage free at 47. My DH is more adamant about being mortgage free whereas I would've been Happy to spread the terms of our re-mortgage to have more money now.

ShotsFired · 10/12/2018 20:28

I am paying over 50% of my salary to my mortgage - the bulk of that as overpayments above the actual repayment. I've just maxed out my penalty-free overpayments for the year or I'd pay more.

I am desperate to clear it. It's more about security for me than the numbers on a statement. Knowing I have this roof over my head and it's 100% mine.

I live in some level of anxiety about my work situation changing because that would set back my plans.

Original poster
broadstairs14 · 10/12/2018 20:36

I will check out this rich dad poor dad book as it has had a few mentions....

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