Oi you, take that huge mic drop out of this thread of pity!
6 - 7 years and you're mortgage free??
it is a lot but its a chunky mortgage in an expensive part of uk sadly.. we can afford the £2k a month, currently.. but with everything else going up it's all slowly getting very tight! we'll have to see what we'll do come remortgage, but we won't be making the mistake we made now, we'll max out our term and over-pay just so we have flexibility.
This guy is wise
Impressive.
But at least you can drive places. Living in London, it's often not really an option to drive places. Well, you can, but it can be expensive, time-consuming and a pain in the bum.
It's funny, 5 years ago, a small house in the countryside would have been my idea of hell, but now I cycle, I'm thinking it would be great. I'm also wondering how easy (or how hard more like) it might be to move to the Spanish countryside...
Thanks, @Martynt74 mentioned this to me too.
Other option is try and find a Spanish wife whilst over there
Hello mate,This intrigued me so I put some numbers in to a spreadsheet, keeps the grey matter ticking....
For a 0% cash transfer of £5k from a credit card with a fee of 3.1% that's £155 in what is technically still interest. The balance of the CC account is then £5,155, over 17 months that's £303.24 per month for 17 months to clear the balance in time. Remember the fee of £155 is not interest fee and if not cleared in full interest will be charged on all of it.
You'll have to keep paying the minimum of that balance which for some credit cards is 3%. The first 3% payment (£154.65) won't cover the fee so additional payment is required as mentioned before. In this example I'll assume additional payments on top of the minimum 3% will be made anyway, like this:
Assuming a mortgage of £170k over 20 years at 3.5%, so £986.26pm with no additional payments would look like this, our baseline:
Taking the £5k borrowed earlier and putting in to the mortgage, keeping the monthly payments as before, would look like this:
Only an interest saving of £84.18 over the first 17 months because the £155 fee eats in to the saving. There is a substantial saving of £4,747.99 over the full term of the mortgage, plus it would be paid off 10 months early. This assumes that the interest rate stayed the same, never remortgage or altered in any way.
What if instead of taking the credit card cash transfer we increased the mortgage monthly payments to what would have been paid to the cc balance for the same 17 months?
Over the 17 month period there is a saving of £122.40 compared to the baseline which is better than the credit card cash transfer method as there is no fee to pay. A nice saving of £4,819.15 over the full mortgage term and it's 10 months shorter compared to the baseline too.
In summary, making regular mortgage overpayments each month is better than a fee inducing cash transfer from a credit card. It's less risky, you can decide not to overpay should you need to one month or more and you don't have to calculate additional payments should you use the credit card for purchases too.
There are a few ways I could see a cash transfer from a CC being better. Instead of making regular CC payments above the 3% minimum required you put those in to a savings account and pull it at the 17 month mark to clear the balance of the CC. I haven't calculated what interest you'd obtain from such an approach but I reckon the savings account interest would need to be at least 3% or higher to see any benefit, plus it's added hassle and complexity. Another factor for consideration is if you are about to end a low fixed rate and enter a higher rate mortgage then paying something in the present will save in the future, increasing the savings made.
I've tried my best with my numbers and calculations but if you see any errors or omissions please let me know.
Hello mate,
Apologies for my slow reply only just seen this!
Your calculations are pretty much spot on! When I made the overpayment it said I’d save around £4700 (can’t remember exact amount without going back in to it) and my mortgage would be repaid 10 months earlier!
I’ve paid the 2.9% fee off already on the card and will clear the £5k off with some money in my premium bonds when the interest free period is nearly coming to an end but will leave as much as I can in there for now to give me more chances of winning! If I can clear £5k again next year it’ll all help
www.express.co.uk
About time we had some good news.Sounds like some potential good news regarding further rate rises which seem difficult post SVB collapse
House price crash averted as homeowners get mortgage lifeline
In a bizarre twist, the US banking crisis could end up saving the UK's beleaguered property market from disaster.
www.abc.net.au
What does this mean for UK mortgage rates exactly ?Reporting on the news we could be on the verge of a second banking collapse?
Interest rate crash in 3...2...1
'The market is telling us something very bad is coming', as global banking crisis deepens
We simply don't want an environment where turmoil in financial markets forces central banks to slash rates while inflation rips, but it's become a real possibility, writes David Taylor.
www.theguardian.com
Reporting on the news we could be on the verge of a second banking collapse?
Interest rate crash in 3...2...1
'The market is telling us something very bad is coming', as global banking crisis deepens
We simply don't want an environment where turmoil in financial markets forces central banks to slash rates while inflation rips, but it's become a real possibility, writes David Taylor.
