Which is the best plan?

[whynotmereally]

Dh and I are mid forties we own a 4 bed detached house with 15 years left on mortgage, there’s roughly 150k equity in the house. We have 3 kids, two are adults one owns her own house the other is saving for a deposit and intends to buy next year. The third is 15.

We have been discussing moving, we each have a different view of what to do-

idea 1
Buy a smaller 3 bed house in a slightly nicer area, use the equity and take out a small mortgage of around 40/50k over 10 years .Enjoy more money due to low mortgage payments. Aim to be mortgage free by 55.

idea 2
Buy a similar size house in a nicer area with better garden/storage /layout. Use the equity and take out a loan for 120-150k over 15 years. Pay significantly higher mortgage than currently paying. Finish paying at 60.

Whiich is better please?

We’re a little bit older than you and there’s no way we’d consider option 2.

I’m seeing light at the end of the tunnel as retirement beckons. Our plan is to pay the mortgage off at 55, reduce our working hours, see more of the world. This will likely involve a downsize but we won’t need such a big house once the kids have gone. Option 1 all the way!

Option 1.
Lide is too short to spend just working to pay off a mortgage, or aim to start enjoying the money at a particular age, say 60. You could have 15 years of enjoying life with less stress which supports your health, less cleaning haha, and the time and money to do things you enjoy which will also benefit your mental abd physical health.

1 without a doubt.

Secret option number 3 - but house one but use the difference in old and new mortgage paymente to over pay and be mortgage free earlier

Option 1. You never know what is going to happen, better to be a bit conservative so that you remain financially flexible. Imagine getting bigger place and an unexpected redundancy or incapacity...

Will your 15 year old go to uni? In which case option 1 so you have the funds to support them

Option 1. Try and get debt free as early as possible

That is a good idea

Yes likely will. The other two did.

Thank you everyone option 1 is my thought process too.

We always over paid & any time we had a pay rise or drop in costs (e.g. Childcare) we increased how much we overpaid so we didn't just fritter the money away with nothing to show for it. It also helps when you remortgage because you'll have more equity, get a better interest rate etc
As a result we were mortgage free at 43.