To feel panic to owe this much on my mortgage?

[Seoalp]

I’m 36 and recently took stock of my finances after separating from my partner and I am now a single parent to a nursery age child. I own my home but it has an outstanding mortgage of 220k. I feel that approaching 40 this is an awful situation. I have 10k savings and a car on finance. Would you downsize to remove the mortgage? I can manage the repayments but 220k feels like SO much money to owe. I am awake most nights recently worrying about it. My friends never discuss finances at all so I have no frame of reference and feel very alone.

...you're not that good at math, are you?

Sorry but this is ridiculous. People are allowed to post what they want. The OP has a worry and fear that is as real to her as anyone else's financial worries.

I'm 42 and still not a home owner and I didn't find it tone deaf or insensitive.

😂

It's fine and you are making the payments. In ten years you will be glad that you did not down size.

Given the circs I would not consider moving. But if it’s a comfort, you have that option later should you ever need or want it. It’s great that you’re overpaying and £500 overpayment a month is comfortable.

There are quite a lot of costs and stress to moving, so best to keep going and try your best to think of it as building up an asset maybe.

Oh, I would add though to look at what that £500 overpayment could do in savings too (especially as you could do tax free via ISA), which gives you more liquidity (depending on access) and potentially better interest which could always be used for a lump sum overpayment later.

I think you've missed the part where I said I'm paying off my mortgage shortly. 200k would be maximum additional borrowing (I would already have the value of my current house to add to that). Not suggesting OP does anything like this. It's mentioned to demonstrate different people's attitude to risk.

44 and owe just over £400k if that helps?I don’t understand your concern at all to be honest. If you’re overpaying so much then what’s the issue?

That’s not a large mortgage. If you can manage the repayments then it’s fine.

You need to divert the £500 for the next 6 months to have some liquid cash - then go back to overpayments.

I think you are fixating because it feels like a huge burden on your own.

You can do this!

Once your equity goes up you can reduce the % rate and the payments come down. You’re not far off by the looks of things. The overpayments will ensure an earlier finish in payments.

A lot of people can’t buy homes until their mid-30s now so I would say your situation is normal/decent. We’re getting ready to buy our first home at a similar age to you.

I’m a similar age and owe more, but we are a two parent family…. Child in nursery. Most of my friends are in exactly the same situations and many are now in discussions about house upgrades… so a much BIGGER MORTGAGE!

I have always planned to ride out the nursery/ early years then when we are abit more stable we will start to over pay the mortgage (the hope ha).

Don’t stress about it, give yourself some leeway during this economically difficult time and expensive time with the children. Then make a plan when you can. But genuinely your situation sounds very very financially normal.

Op I'm sure it's been mentioned but it maybe worth putting the 500 per month into savings with a high interest rate so it makes money then pay off mortgage in chunks but you also have the savings there should you need them..

I completely understand how daunting it must feel but wait 10 years and see where you are then..
See where interest rates are etc.

No it isn't. The poster has anxiety. If any post is insensitive it's yours!

OP I would put the over payments into savings as I think having more savings will reassure you. Perhaps talk to a financial advisor about your options if you're not comfortable making decisions yourself; I understand, there's so much change and it can feel overwhelming.

I owe £190k on a mortgage, only just manage the monthly payments (thanks Liz Truss!) and am on my own... I also don't have a job at the moment! But it's the one thing that doesn't keep me awake and money always worries me... It's because this is my place, I love it, I never thought I'd be able to get a property and when the Truss situation first happened I decided if the worst came to the worst I'd rent it out and move in with my parents. The way I see it isn't that it is a debt, but it's my little nest. You can easily manage this, but it's entirely natural to feel like you can't at the moment. You feel vulnerable and are dealing with so much change, I would use the money you overpay to talk to a therapist who will be able to help you see your situation very differently. You're doing brilliantly.

You can downsize in the future.

If you can afford it now and overpay without going without and it's right for you I'd continue.

If in 15 years time when you child may be going off to uni or getting a job and don't need speaker for toys etc you can sell up then.

I would overpay a bit less and build up savings , having several months mortgage payments or money for repairs and big bills is much more reassuring.

Overpaying by £500 a month is amazing and will seriously knock off years which means will knock kff interest

If you can pay for childcare , mortgage and overpay you are doing fine don't panic

Agree.

Many people do not have £500 a month. Let alone

£500 to overpay on a mortgage.

Objectively, you're doing fine OP. You're in a much better situation than me (ten years older than you, bigger outstanding mortgage, less in savings, no scope in my budget for overpayment).

It is terrifying when you first have to take on all the financial responsibility on a single income. I am constantly thinking about money.

The advice to stop overpaying and build up some more savings is good. Then you can choose how much to overpay in one lump at the end of the year, for example.

If you haven't seen your GP then it is worth speaking to them in case you need support with the anxiety. I found counselling invaluable in the early days after my separation and really recommend it as a safe place to get things in perspective.

Hopefully the kinder people on this thread have put your mind at rest to some extent about your financial situation.

Don’t think about it in those terms. You already own more than half your house and your equity increases with every payment. Repaying a mortgage is a marathon, not a sprint. If it makes you feel any better we didn’t clear our mortgage until we were both over 60, you’re likely to be quite a bit younger than that.

As long as you can afford it, the amount is irrelevant really. Think how much you would potentially pay in rent over the rest of your life if you rented rather than owned and your remaining mortgage will feel like a bargain. Plus your mortgage will reduce in real terms over the years, whilst rent would increase.

Also, don't listen to your parent's generation when it comes to how much you owe on a mortgage, how long your mortgage is etc. The housing market is completely different now to when they purchased.

DH and I are 44 and first bought in 2009. DFIL casually said we mustn't have too much longer to go on our mortgage by now since they got a 20 year mortgage when they bought and overpaid so they were mortgage free by the time they were 50. Our mortgage currently runs until we're in our 60s since house prices are high where we live so we got a 35 year mortgage. We've since moved and extended so we have added more money to the mortgage but a little bit of overpayment has knocked a couple of years off.

When people complain about super long mortgages I think they are overlooking the fact that for a lot of people the only other alternative is to rent until they die.

Mortgage isn't really a debt like any other debt. You have to have a home to live in until the day you die. So you're going to have to pay a monthly sum, usually the majority of your wages you're whole life. The difference between renting and owning is that when you're dead, there's some asset left for your kids.

As long as you can afford the repayments, I'd just stop worrying and enjoy your house

You need to consider your age when it’s paid off. That’s the only issue if you can afford the payments. This is how mortgages work. I’m 10 years older than you and have a mortgage over double that, so I’d chill. 😜