Downsize for mortgage free or just wait and pay off the mortgage

[Frozenbanana1]

Live alone, own house worth maybe £230k, £42k left on the mortgage. Have a good mortgage rate which doesn't end until mid 2029. I have 9 years roughly remaining so once that fixed rate finishes I'll have about 6 years left. I think the early repayment charge would be about £1.5k

I could probably get a very small 2 bedroom house for around £170k.-£180k
No children, I have a partner but live separately

How much would selling and buying a new house cost roughly?
If costs for selling and buying are crazy then I may end up with a mortgage still at the end.

Would you stick it out for the next 9 years, wait until mortgage renews in 3 years or just sell and move now?

Solicitors/conveyancers fees
Estate agents fees
Stamp duty if applicable
Removal costs.

Estate agents fees vary from 1% upwards. You pay as the seller.
Legal fees are impossible to predict in your area.
Removal fees depends on whether you want a full service, removal only or diy with a man and van.

How old are you? What be your reason for downsizing?
Would the downsize be suitable to live in in old age? Because bungalows cost more than houses often and if you had to move to a bungalow would you be able to afford it?
Without knowing your full circumstances I'd probably sit tight, over pay as much as possible over the next 3 years and then reassess. If your on a high interest rate I'd consider putting the overpayment into a savings account and then paying a lump sum at the end of the fix.

1. do you want to move? Is it not the right house? Or is there a drive to be mortgage free?

2. if the drive is to be mortgage free and you aren’t too fussed about moving can you make over payments on your current house? Have you checked an over payment calculator and how this brings your mortgage down?

Take what it would cost to move and spread that out into overpayments instead, you'll be mortgage free much sooner! There are calculators online which tell you how many years you'll shave off by overpaying.

The thing about moving is all the stuff you didnt budget for............

Do yo want to stay in your house or not?

If you do then stay

Depends why you are doing it. Are you moving to have more free cash? Are you struggling each month? Do you love your house? What sort of house would you be able to buy with 170k - would you be happy to live in those houses vrs keeping your own.

Lots of things to think about.

What difference will being mortgage free make to your life? MN talks about it as if it's a massive difference but if your monthly payment is small you might barely notice.

Do you like you current house and is it suitable for your needs? If so I wouldn't move just to be mortgage free unless you're currently struggling with money.

Agree with pp your motivation for moving makes all the difference. If you are only just managing it might be worth doing the sums. If it’s not a strain I would stay where you are.

Do you ultimately WANT to downsize or are you doing it just to become mortgage free?
If this, could you end up regretting your decision and living in a house which is smaller than you want. It may not bother you in the beginning but in the future (especially after the mortgage would have ended anyway) you may end up regretting it.

We were mortgage free (a great feeling) relatively early on by making overpayments almost from the very beginning but approaching retirement we actually bought a larger property as we like our own space and the ability to move around in later life.

Do you like your house/location/garden/neighbours?

If yes to all, stay
If no to all, move
Mix of answers? Think about it.

If your mortgage isn’t putting you under strain, and you’re happy with your location and neighbours stay put and overpay.

Don't underestimate the stress of moving and downsizing and also the cost, stamp duty, solicitors, removals etc will all be expensive.

If you can afford your mortgage and are on a good rate, stay put.

I downsized at 46 because I was single, DC had left home, the house I'd been in for 20yrs was 4 bedrooms and way too big. I bought a 3 bed house, easier to manage and not having a mortgage is fantastic.

The moving expenses came out of the equity when I sold.

Does your current mortgage all overpayments in the course of the mortgage? For example our mortgage allows us to pay up to 20% early without an early repayment charge.

If so you could make monthly over payments to shorten your term

As everyone else says, this is a big 'it depends' question.

Will it save you a lot on bills for the next 20 years or so ?
Does it mean you might live in a less nice area?
Does it mean you might end up with more neighbours (detached to semi, or semi to terraced or terraced to flat)?
Does it mean you lose parking?
How convenient is the location to things like transport and shops, Drs and hospitals, or parks, or motorways or whatever your life is made up of?
How old are you?
Do you have people who might come and stay?
Mainly, what is wrong with where you are now, or the house you are currently in?

You've not given enough information to answer your question.

But, if you have the 'spare money' to do so, why not save monthly into an interest baring account until you are out of your fix, then pay off a chunk at that point. You find once you are down to the last few years, overpaying becomes easy and you see a real difference.

I've recently sold my four bed victorian terrace for 235k and now looking for a two bed in the next town for around 190.
Just me and my son of 18.
I'll use the equity to put in to my Sipp which stupidly I only started at 50,being self employed.
I'm also fed up of the maintenance of a large house,it gets quite overwhelming for me. I realise a smaller house will have some but today I counted the Windows of the houses I am viewing and most have four or five,compared to nine in my current home. They also don't have a dishwasher and I'm thinking that's another thing I won't have to worry about! I just want easy in my mid fifties.

Current house is fine, decent enough neighbours and area. If I downsized to £170-180k house is go from 3 bedrooms to 2 bedrooms, probably smaller garden.
Main reason for considering is just the thought of needing to pay the mortgage for another 9 years and living alone, being dependent on one income. It would be nice to have one less bill and some extra cash to be able to save. I can cover all my bills and I'm pretty careful with my budget but it would make me feel a bit more secure to be mortgage free, especially if I lost this job and needed another, I may end up with a pay drop and struggle a bit.
I do have some health issues so I think that weighs on my mind although I'm fairly young, I do worry about long term ability to work full time if it goes downhill again and having no mortgage would give me some flexibility

Stick it out!

I would look at your earlty repayment fees. You have 3 years left so you may find they drop next year.

Pe4lrsonally, we are downsizing as soon as the kids leave home. (End of this year). We want more freedom and although we dont have a large mortgage (circa £600 per month), it's something we are always aware of and would love to be free of. We are aware that means a smaller house thay probably won't be in as nice an area, but we have plans to renovate, so we are aware we won't be moving to our "forever home.' Would you be able to move from your downsized if you don't like it?

This! DH and I have a 5 bed, 3 rec, 1 study huge open plan kitchen diner detached house with large walled garden. We only have around 20k to pay the mortgage off. A few years ago we thought about downsizing and buying a future proofed bungalow. A 3 bed 1 rec bungalow was going to cost nearly the value of our house so we decided to stay put and use the extra rooms we have for whatever we wanted! I now have a sewing/craft room, he has his sports room complete with beer fridge, the study is now half study half art studio and our single cat has the big bathroom to herself where her litter tray is!

I think its good to have a part mortgage, its impossible for someone in this case to be evicted.

Assuming your current house is decorated to your taste and maintenance is up to date then I doubt you’d see much benefit from moving. I’ve always worked on the basis that moving cost £20k on fees, stamp duty etc and that it takes £30k to decorate a new property to your taste. The £30k might be used on carpets, maintenance, painting & decorating, new furniture where your current furniture doesn’t fit etc. last time I moved I was surprised at how much I spent on tradespeople putting in new electric sockets where I needed them, putting up shelves, fitting a pump to the shower to give me better water pressure so I could have a bigger shower head etc

Is this a long term house? Is the location good? Can it be used for downstairs living ie bedroom, bathroom, access in and out of doors, parking? Or will you need to move anyway in the future?

one way to bring your mortgage down easily is to pay fortnightly. This saves a lot of interest. Look into it.