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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:
Adversecamber22 · 11/12/2018 02:39

Overpaid and paid off entire mortgage and incurred no penalties by our late thirties. We had quite decent jobs but both had investments we had made pay out, we both started dabbling in our late teens/early twenties.

We did keep the mortgage for a little longer due to keeping options open regarding any credit etc.

We live in quite a cheap part of the country but house is worth about 200k more than we paid for it. We continue to invest, uncertain times make for poor returns though.

It has meang never worrying about a bill, lovley holidays, being able to help out my sisters.

Bunnymumma · 11/12/2018 03:20

We saved a big deposit and bought what we needed and liked, not the biggest thing we could afford on borrowed money. We then double paid every month and saved extra where we could to pay lump sums off whenever we came out of fixed rate, before going back in. Mortgage was done in 7 years and for us, the security of knowing nobody can rip our home out from under us is priceless. We are now taking our time to do it up exactly as we want to and it's been much less stressful this way round.

ashvivienne · 11/12/2018 03:52

We had savings and sadly OHs mum passed very suddenly but she left OH a large sum of money and we bought our home. We have lived here for 15 years mortgage free. Its allowed us to put away more savings than we would have ever been able to it’s allowed me to go back to work part time after I had my last 3 kids. It’s an amazing opportunity and I would overpay if we hadn’t inherited this money.

PyongyangKipperbang · 11/12/2018 04:02

I will be mortgage free in 6 years at 51. I will be fucking thrilled! ITs not about the money but the fact that once that house is mine, nothing but the most major financial disaster will take it off me. Its security for life. I am not in a position to over pay but as I bought it at the arse end of the last big housing crash, it was a bargain so my payments are (relatively) low compared to most.

To me it wont free up masses of money but it will give me lifelong peace of mind, especially as I dont have a pension.

namastayinbed · 11/12/2018 07:03

Ours should be paid off by when I'm 60 but hoping to reduce this to 50 by overpaying each month and chucking anything extra at it. I could be debt free by now (late 30s) if I'd stayed with abusive ex, but frankly would rather have the mortgage!

Minniemountain · 11/12/2018 07:14

We have an offset mortgage as DH is a contractor. This month's statement showed we are now fully offset.
It will mean DH can take all school holidays off to be with DS. We'll have some more expensive holidays now.
DH's salary paid off our current house but we briefly were mortgage free on our first house. That was a combination of living in a cheap area, living frugally and having one DC.

Coffeebean76 · 11/12/2018 07:26

This thread is inspiring..... overpaying is definitely the way to go.

festivedogbone · 11/12/2018 07:30

We are set to pay ours off in our late 30s (currently mid 30s).

I'll preface this by saying I know we are lucky, and that some people wouldn't gave a choice but to buy a cheap house.

Bought this house 6 years ago for just over 100k. It's a big standard ex council 3 bed semi kind of house in a working class area. It's absolutely fine.

During that time DH's salary has more than doubled (I'm a SAHM). His colleagues all live in the most desirable sort of houses in our city - large period houses and 4 bed detached newbuilds, all of which are 250k plus. They're set to be paying 1k+/month mortgage for 25 years altogether. We pay 1k/month plus any extra we have spare and live a cheaper kind of lifestyle (one old banger, shop at Aldi, UK holidays, few new clothes/hair cuts/beauty treatments etc) to free up money.

For me it's about a) recognising that a posh house wouldn't make us happier than having lots of spare cash would - the happiness return on a big house just doesn't seem worth it. We'd get used to it and it'd not feel any different to living here. I recognise that is a personal choice though. I also don't care about being seen to live in a less nice area. It's not unsafe here, just not as desirable as other neighbourhoods.
b) we both grew up with parents who were constantly chasing their tails to pay bills, his were/are on benefits and mine work/ed but over-stretched themselves (we had the posh house but food got short by the end if the month) so we just want to have that security ASAP.

festivedogbone · 11/12/2018 07:32

bog standard, not big, that was the point I was making Blush

Faroutbrussel · 11/12/2018 07:34

We have never had a mortgage and paid cash for our house. Dh and I didnt have amazing jobs but when we were child free we lived off one of our wages and saved the rest. We also chose too live in a small rented place where we were only responsible for the rent and electricity. Now we own our house it seems like rates and insurances take up a lot of income. We also only had one car but worked very near each other so it was ok. We saved enough over 10 years to buy outright. It wasn't really planned, the first 20k seemed to be the hardest and were happy with what we were doing so we just carried on.
This has allowed me to be a sahm for 6 years and also because of the equity we were able to buy a rental property. We plan to retire early.

In general I would say we were quite frugally and look around for best prices, however, we do like nice holidays and are happy to spend extra money on them.

anniehm · 11/12/2018 07:50

Once I thought it would make a big difference but actually my mortgage is only 20% of monthly outgoings and falling so it won't make a huge difference. Once it finishes I plan to save that amount for retirement

BarbaraofSevillle · 11/12/2018 07:52

But most people can no more pay cash for houses than they can build a time machine to return to a time when prices were more affordable.

And there's been plenty of times in the past when prices have been going up so fast that any amount of deposit saved was completely overtaken by the rise in prices, eg in the early 2000s, ours went from £50k to £100k in a couple of years.

Anyone thinking in 2002 'all I have to do is save my entire salary for a couple of years and I can buy a house for cash' would have still needed a £50k mortgage and have wasted 2 years of frugal living to achieve nothing.

LoubyLou1234 · 11/12/2018 08:00

OP I'm like you we were 38 getting our mortgage luckily it's a small one and overpaying. I'm hoping to be done within 15 years.

I know the rates are low and I could do better saving the money but the way I see it if rates rise I'll have less of a balance to pay higher interest on (fixed for 5 yrs) Plus I hate seeing that balance every time I log onto banking!

However we dont scrimp and save, I pay a set overpayment and continue to also save money too as the house needs new decor. I still want to live and have holidays and activities etc. I think we have a good balance.

Like PP I work in a very active demanding role and by the time I'm approaching 60 I'd love to be able to go part time. Time will tell!

OrcinusOrca · 11/12/2018 08:02

It must depend how much it is. Ours is nearly £1400 a month, about a third of our income, so it would make a huge difference to be mortgage free. I know people who only spend 5-10% on their mortgage though so it wouldn't be quite the same for them.

joystir59 · 11/12/2018 08:02

If you can clear it in 4-5 years I would drive to do it OP. Being a mortgage slave is a fearful position to be in I feel- you do not own the roof over your head putting it bluntly. I am assuming downsizing/relocating wouldn't be an option? That'show we cleared ours, but we are older- we moved North from London.

joystir59 · 11/12/2018 08:06

The thing you don't realise when you are young is that you do get tired, especially if you are working in any kind of labour intensive or front line job. That is partly why we made a move (to the seaside) and cleared the mortgage. We saw older people stuck in houses they couldn't maintain, living alone in one room due to lack of mobility. They were sitting on heaps of equity but no energy to do anything about it. So don't leave major changes until you are retired.

TiddleTaddleTat · 11/12/2018 08:27

@joystir59 similarly, our mortgage free property in a rubbish area of the SE buys us a 3 bed house in far nicer, other parts of the U.K.

ShotsFired · 11/12/2018 08:32

I've just re-done my overpayment calcs for my 10% fee-free overpayments as that resets on 1 Jan.

Based on the Jan 18 balance/overpayments, it was on track to be cleared in 10 years.
Based on the Jan 19 balance/overpayments, that has shrunk to ~6 years.

If that's not an incentive to see what Jan 20 brings...

Ariela · 11/12/2018 10:05

We overpaid for years on our mortgage, and I had an old endownment that paid out and paid off the remains of the mortgage and put solar on the roof in the days you got a decent FIT return. Was invaluable as shortly after DH was made redundant so he was able to do nothing for almost a year while looking for work while we didn't have to worry about money.

scaryteacher · 11/12/2018 10:05

We will have cleared ours in about 10 months - we are overpaying a lot to get it gone by the time dh fully retires at the end of next year. It'll be gone two years early, so only CTax and utilities to pay when we move back to UK.

mrsm43s · 11/12/2018 10:20

We paid ours off (by saving/frugal living/overpaying - no windfalls) in our late 30s. We're in an adequate, but not amazing house that we bought in 2002, unlike most of our friends we didn't upsize our house (and mortgage) to the big detached "forever home".

It's allowed us the option to send our children to private school, which we would struggle to afford along with a mortgage too. Fees for two cost more than our mortgage ever did, so we don't feel financially better off as such, but it would definitely have been a stretch too far if we had the mortgage to pay too.

In a few years when the children have left school we will probably feel quite rich! We will probably put money aside so we can slow down workwise when we feel ready, and also to help our children with getting their own property etc.

I don't regret paying off the mortgage at all, it gives a great sense of security, and will allow us a lot of choice in the future.

Fstar · 11/12/2018 10:27

Ive had to reapply for my job 4 times now and have survived through all the changes at work so,far. Having no mortgage certainly took the biggest stress out of it. I have more money to spend now on things i want and able to,save for future.

Unfortunately mine was paid through ill health so cant comment on what you may need to give up.

tirisfalpumpkin · 11/12/2018 10:54

Interesting thread. I’ve just fallen into the MSE forums.

I am 31, DH is 35. We owe about £75k on a £150k property and our fixed rate ends next year so we’re looking at paying a bit off and looking at how to clear the debt faster. Our monthly repayments are low but about 1/3 is just interest, which seems like a waste.

It’s the security that appeals, having been homeless/sofa surfer before. I think I could be very frugal with other living expenses if we had a drastic drop in income, but just knowing our house is safe would be a great anxiety reduction for both of us. My husband also has health issues and would like to reduce his hours eventually, so it’d help with that too.

sallysummer · 11/12/2018 11:08

It's good in terms of lifestyle choices, I've been in the same small house for twenty years and never upsized as peers have done so have no mortgage and can work part time.

recently · 11/12/2018 11:47

We had almost paid ours off then unexpectedly had twins and needed a bigger place! Ah well, they are worth it...most of the time.