To want to throw in the towel and go mortgage free? Everyone telling me not to?

[Yetsterday]

I have a two year old and broke up with DP a couple of months ago. I am or was lucky that we lived in my mortgaged home. It’s worth around 500k with a 280k mortgage. This is repayments of around 1k a month. I earn more than ex and he will be paying 400 a month towards dc as per the CMS calculator.

Even though I am used to paying most things myself, I suddenly feel spooked with this mortgage as a single parent. My take home is 3k so in reality I have 3,400 a month to make it all work. I’m feeling very overwhelmed. I have seen some terrace houses nearby that are 240k so I would practically be mortgage free. I’ve voiced this with friends and family and they think it is crazy to do it unless it was strictly necessary as this house will go up in value more and then if I did downsize in future it’s always there. I do get their point but I feel sick most nights that this is on me and I now also have a child to think of. What to do? Has anyone been in a similar scenario? I feel constantly worried as have only 3k savings which I’m also trying to build up but obviously 3k won’t get me far.

I would say go for it - I would go even further and say look for something cheaper than 240k if it is at all possible then you would give yourself a good buffer of savings etc

I'd hang fire for now. Your monthly income is good, way more than I get and my outgoings are only slightly under yours.

Also your bills will go down with one less adult in the house.

This.

Don’t make any sudden decisions, especially as the housing market is so low, but also - don’t be bullied by family members telling you to be sensible and do whatever is needed to make maximum money on your house. It’s a home not an investment portfolio. If you want to follow your heart and not your head there is nothing wrong with that. If DH and I split up there is no way I’d stay in a too big family sized house, with all the sad memories, when I could be starting a new life in a cutesy 2 bed terrace.

I WOULD NOT follow the advise to let out your property you'll pay 40% tax on the income and if you get bad tenants that don't pay rent and need evicting you'll be financially screwed. X

I would wait and see.

You shouldn't make such a big decision in a hurry when you are still reeling over relationship breakdown. Moving is costly in itself as well as disruptive and stressful.

Sit down and do the sums. Work through a budget, and review your finances to ensure everything is working as well as possible. Work out where you can save if necessary, and what your emergency strategy would be (mortgage holiday? Income protection insurance?) and hopefully that will make you feel a bit more confident.

Maybe challenge yourself to a frugal January or to earn some extra cash to help you build a buffer of savings. Don't put too much pressure on though be kind to yourself. I mean things like decluttering and selling on stuff you don't need, doing free activities at the weekend, making packed lunch, doing some surveys etc. It won't make a massive immediate difference but might help you feel more in control.

In 6-12 months do another review of your budget and situation and if you still feel concerned then start looking at some properties and doing some sums in terms of how much moving would cost and how life would look if you moved.

I think things will get easier and you shouldn't do anything radical now. Downsizing might be the answer but don't rush into it.

I would hold on. What seems like a hugemortgage now might not seem that way in 5 or 10 years with inflation being high. Being single, having good neighbours and a nice , safe, quiet neighbourhood can be a boon. Supposing you meet a new partner. Unless you love your current house, maybe downsize the mortgage and have a new start in a house you absolutely love.

I've stayed in a smaller house to be mortgage free by mid 40s and retire around 69. Meanwhile, friends my age are panicking about huge mortgage rates and worried they'll still be working at 70+. Quality of life is much more important.

*retire around 60. (I'd cry if it was 69 😂).

Yes

About a quarter of UK properties are terraced, and another quarter are apartments

I sometimes have to remind myself of this after reading threads here!

I live in a lovely warm quiet terraced house with some friendly neighbours, some who keep themselves to themselves. Just check out location and build quality as you would anywhere.

I can honestly say I had no idea there were such negative attitude to terraces until I started reading this site. I have always lived in them and never a problem.

No mortgage is like growing wings

Most people I know live in flats and terraces as well

even some of the most expensive houses down here are bloody terraced.

I can’t believe so many on here live in detached houses and still complain about noise 🤣

I have literally never had any bother with neighbour noise except once when they were drilling 4 am and just knocked and asked them to stop

I do wonder where everyone is based with this abundance of detached housing

I'm probably the last person to give advice on this, never having had a mortgage. The laugh is that I could afford to have one now if I could guarantee being able to work for the next 30 years. I am already drawing my state pension.
Lots of good advice here:
Take your time; do your research; only move if you really like the house and the area into which you would like to move; it must fulfil your needs.
I think you feel that you need a change. It is a relief to me that I don't have a mortgage to worry about.

I was in this situation years ago, and took in a lodger, who was a lovely woman. It all helps, until things pick up.

Not a good idea to make such a big decision so soon after a break-up, unless you have no choice. Revisit the situation in 6/9 months.

If your mortgage is fixed at a relatively low rate I would definitely stay put until you need to remortgage, and see what the market and mortgage rates are like then.

Being mortgage free does feel good, and no doubt would relieve you of the responsibility you feel.

However, being mortgage free in a house that will house you well until the kids leave and you might consider downsizing is completely different to if you will need in the future to upsize, upgrade or move to a more expensive area for schools etc in the future.

Having said that the aversion to flats and terraces so often expressed on MN seems so often unrealistic, privileged and a bit hysterical. “Lucky for you mate” to anyone who can afford detached etc, but many of us live happy normal lives in other types of housing.

How old are you OP? You have a good salary and a decent proportion of equity, and I think downsizing could set you back in the long run.

Can you rent a room out at your current house to support your costs?

@BrimfulOfMash thanks. I’m 38.

@Yetsterday it's a good plan but right now, the market is not good for selling and you may not get a good price. I would hold out for at least a few months as you get used to your new budget and see what happens to the market. also, just the solicitors fees and estate agent fees will cost you more than 3k. and don't forget stamp duty (around 10/15k at your price range) not to mention the inevitable refurb/repair costs which will be far more than you can anticipate. there may be urgent repairs needed or problems which you don't realise until you move in. you may be trading more stress for the relatively lower stress of the mortgage.

I would see how you feel towards tge end of your fixed period. I don't think it is the best time to sell at the moment and you are on a low interest rate.