To mortgage or not to mortgage?

[Darr3nG]

I don't want to gum up the GMT, so moving this discussion out here... @treetop1280 @Bratnia

 

Very interested in the pros and cons

 

@MancunianStacker @GoldDiggerDave

[treetop1280]

Just now, Darr3nG said:

I don't want to gum up the GMT, so moving this discussion out here... @treetop1280 @Bratnia

 

Very interested in the pros and cons

 

@MancunianStacker @GoldDiggerDave

Oh yes , I want to buy a house for £250 grand and pay back £350 over 25 30, 40 years , god knows what  it is these days , , we shall agree on £500 a month , 2 years later bank says deals off give us £650 a month.  2 years later , it’s £800 a month , , on and if you miss 3 payments , we are keeping the money you have payed us , keeping the house , and your homeless ???  , “ it’s a racket always has been , “ borrow as little as you can , and get it payed off as fast as you can 👍

[Darr3nG]

8 minutes ago, treetop1280 said:

I’d rather have no mortgage than a mortgage ??? , “ and your only 3 paycheque away from repossession,( and interest rates is just another racket)  , ask anyone who does not have a mortgage, the weight of there shoulder  they feel , and the freedom they feel ??? 👍

I'm less than a year away from clearing the mortgage... aggressively overpaying, combined with maxing out savings/investment ISA and other high(er) interest savings.

It's the freedom, I'm after. I wanted to change job and travel more, in the last few years, but there's always that pesky mortgage bill keeping me grounded.

[SiCole]

Depends if you can't make a better return on your money or not and how entrepreneurial you want to be about it.

If you have a mortgage at 1.7% like i still do, can you not currently get better returns than that? Theres a case to be made for both sides tbh

I was exactly like you Darren and got a 17 year mortgage down to 10 years with overpaying and are down to the last 20k i could pay off now but theres better things to put the money into instead of lumping it into one asset that makes you no returns. 

[treetop1280]

5 minutes ago, Darr3nG said:

I'm less than a year away from clearing the mortgage... aggressively overpaying, combined with maxing out savings/investment ISA and other high(er) interest savings.

It's the freedom, I'm after. I wanted to change job and travel more, in the last few years, but there's always that pesky mortgage bill keeping me grounded.

A year , hopefully interest rates go to 90% , and house prices drop by 70% . , but only for  Irish Catholics  who have less that a year to pay 😀👍

[treetop1280]

2 minutes ago, SiCole said:

Depends if you can't make a better return on your money or not and how entrepreneurial you want to be about it.

If you have a mortgage at 1.7% like i still do, can you not currently get better returns than that? Theres a case to be made for both sides tbh

I was exactly like you Darren and got a 17 year mortgage down to 10 years with overpaying and are down to the last 20k i could pay off now but theres better things to put the money into instead of lumping it into one asset that makes you no returns. 

Nothing wrong with that 👍, as long as you have broke the back of the majority of the debt 👍

[Darr3nG]

4 minutes ago, SiCole said:

how entrepreneurial you want to be about it.

^this is key. Many people are just locked in to how things are and go along with the status quo. You know the type who never shop around for a better insurance quote or phone contract because it's too much hassle.

 

5 minutes ago, SiCole said:

theres better things to put the money into instead of lumping it into one asset that makes you no returns. 

This is going to be different for everyone... once the mortgage is clear, I'll see then if I want to sell up or rent it out - either way, it'll be a return. 

[SiCole]

Like you say everyone is different and its down to adverse you are with debt. I personally don't think you have a debt issue, more an income issue. If you had an additional income coming in from other sources which was more than the mortgage payment you wouldn't be bothered about the mortgage as you knew it would be paid anyway.

[ZRPMs]

To mortgage or not to mortgage? That is the question. It's a highly personal one I feel. There's a lot to be said for removing the debt of a mortgage. The value should not just be measured in monetary terms but also peace of mind. As far as my BTL mortgages have gone I've over paid and cleared several off and the relief that comes from reducing and clearing the liability certainly has benefit. I understand the cost of missed opportunity on alternative investments however, The increased cash flow also has benefits.

When it comes down to your own home. This should purely be regarded as an essential housing liability. It's a cost that will always be require in so much as we all need a home, Wither we Rent Or Buy. I've never regarded my home as an asset. Personally, whilst the interest payments were low I made large overpayment. I used my largest mortgage payment as the base monthly payment and as the rates dropped I kept them at this level and when I could re-mortgage at lower rates, again made over payments up to that amount or my 10% over payment allowance. The compound effect of making these overpayments far out weighed any returns from investments that at the time, I thought I could get from other quite safe investments. I say quite safe or low risk because any payment for my home I've always classed as a cost I need to pay and would not want the affordability of my home put in jeopardy. Fast forward to last year and I needed to either pay off the mortgage or re mortgage at the new rate. I was on the fence a little but chose to re-mortgage with a deal that allowed me to over pay by up to 50% as I though I could make more with the capital than I could save by paying of the mortgage. Next year though. I will pay what remains off and the extra cash flow will help.

 

[treetop1280]

But to let , renters ????? Are you keeping forever , or passing on ???👍

[GrahamDiamond]

2017 Should I overpay the Mortgage or Purchase GOLD ??? 2024 I Purchased GOLD instead of overpaying the Mortgage, I now have enough GOLD at today,s fiat prices to pay off said Mortgage and still hold some GOLD. I was lucky to purchase in 2017 on wards IMHO.

[ZRPMs]

36 minutes ago, treetop1280 said:

But to let , renters ????? Are you keeping forever , or passing on ???👍

In the process of selling. As a private landlord, I'm sick to death of being vilified whilst my pocket gets ransacked by all and sundry not least the state. One each for the kids as a home the rest F them.  

[Darr3nG]

2 minutes ago, GrahamDiamond said:

2017 Should I overpay the Mortgage or Purchase GOLD ??? 2024 I Purchased GOLD instead of overpaying the Mortgage, I now have enough GOLD at today,s fiat prices to pay off said Mortgage and still hold some GOLD. I was lucky to purchase in 2017 on wards IMHO.

I'm kinda in the same boat... 2019 no mortgage, started buying silver gold. 2020 inherited a mortgage, kept buying gold. 2023 renewed mortgage and reconsidered options, so started overpaying and I should be able to clear by next year, using some of the bought gold.

Inheriting the mortgage was painful too... took more than a year for probate, mortgage company refused to accept payment in the interim, but then charged £££'s for missed payments and interest! Tried to change the mortgage terms, but got presented with very unreasonable fees, so had to wait until renewal. Not a good experience   

[ZRPMs]

2 minutes ago, Darr3nG said:

I'm kinda in the same boat... 2019 no mortgage, started buying silver gold. 2020 inherited a mortgage, kept buying gold. 2023 renewed mortgage and reconsidered options, so started overpaying and I should be able to clear by next year, using some of the bought gold.

Inheriting the mortgage was painful too... took more than a year for probate, mortgage company refused to accept payment in the interim, but then charged £££'s for missed payments and interest! Tried to change the mortgage terms, but got presented with very unreasonable fees, so had to wait until renewal. Not a good experience   

Heard of this a few times now. Others have ended up having the property seized by the bank and sold. After applying extortionate fee's for the process the bank walk away scot free whilst lining their coffers.  

[GrahamDiamond]

Started out in 2017 with a Ten Year Plan, I can retire in 2026 if I wish and Pay Pay off ALL Debts ( including whats left of my Mortgage ] I will see how I feel when the time comes , I may choose to carry on working and Purchase GOLD with my Pension Benefit I claim from the Government, Choices ? Choices ?

[treetop1280]

19 minutes ago, GrahamDiamond said:

2017 Should I overpay the Mortgage or Purchase GOLD ??? 2024 I Purchased GOLD instead of overpaying the Mortgage, I now have enough GOLD at today,s fiat prices to pay off said Mortgage and still hold some GOLD. I was lucky to purchase in 2017 on wards IMHO.

Good stuff Graham , Lady Luck is on your side 👍

[GrahamDiamond]

1 minute ago, treetop1280 said:

Good stuff Graham , Lady Luck is on your side 👍

Take risks sometimes in your life, does not allway,s pay off. I thought if I overpay the Mortgage the Bank makes more money from that money, I became a Bank and Made money from money, rewarded with REAL Money GOLD !!! Could all backfire at any time in this weird world we are living in . Gold could crash at any time before I cash in ??

[treetop1280]

11 minutes ago, GrahamDiamond said:

Take risks sometimes in your life, does not allway,s pay off. I thought if I overpay the Mortgage the Bank makes more money from that money, I became a Bank and Made money from money, rewarded with REAL Money GOLD !!! Could all backfire at any time in this weird world we are living in . Gold could crash at any time before I cash in ??

Life is all risks ??? As we all know ,”  win lose or draw , is the story of us all 👍

[Darr3nG]

2 minutes ago, treetop1280 said:

Life is all risks ??? As we all know ,”  win lose or draw , is the story of us all 👍

Did you choke on a fortune cookie?

[Mysstree]

2 hours ago, Darr3nG said:

  2 hours ago, treetop1280 said:

I’d rather have no mortgage than a mortgage ??? , “ and your only 3 paycheque away from repossession,( and interest rates is just another racket)  , ask anyone who does not have a mortgage, the weight of there shoulder  they feel , and the freedom they feel ??? 👍

Thought i had woke up in some multiverse version of the forum due to the price of gold hitting 2K, where’s Earth 616 treetop? 😄

Yes, that last payment, you look around and think “its all mine”.

Have had no debt for a few years now and it’s liberating. No mortgage, no credit card debt, no PCP or other car c**p.

Live a relatively modest life in a small inexpensive house worth about 350k (this is Kent, beach huts here are £65,000) so its not some massive multi room mansion.

You can’t completely escape the rat race in the UK but i am like that guy when say your watching the olympics and the the focus is on the main event on the track and out of the corner of your eye you see this person who is peripheral but fine with where they are. Thats me.

[MancunianStacker]

I like to have a safety net I can access, so I save in gold (cash too easy to spend). Then once my gold stack value equals my mortgage, I will likely pay that off and continue stacking but using my old mortgage repayment amount on top of my gold savings amount to buy gold again, re-starting the stack. Then target the BTL mortgage with the same idea, unless I decide to sell those.

Governments keep changing the rules on everything from Pensions to ISAs and maybe even the state pension will be means tested when I get there.

A gold stack is invisible really. 👍🏻 

[GoldDiggerDave]

A mortgage is better than renting in many cases.   How you store your wealth is your risk and reward, for me I will never gamble with the roof above my head.   Being mortgage free is a massive weight off my shoulders and given me far many more options as I would have grinded my job out for another decade otherwise.

In 2024 I need to work 2 days per month out of 20 working days to cover my fixed outgoings.   I consider ourself fortunate and far better off than someone else earning 4x what I do but has to work 16 days out of 20 per month just to cover their costs........They have to go to work,  I have a choice if I want to work.  

Wealth = freedom, or as free as you can  be in this world

 

[treetop1280]

12 minutes ago, GoldDiggerDave said:

A mortgage is better than renting in many cases.   How you store your wealth is your risk and reward, for me I will never gamble with the roof above my head.   Being mortgage free is a massive weight off my shoulders and given me far many more options as I would have grinded my job out for another decade otherwise.

In 2024 I need to work 2 days per month out of 20 working days to cover my fixed outgoings.   I consider ourself fortunate and far better off than someone else earning 4x what I do but has to work 16 days out of 20 per month just to cover their costs........They have to go to work,  I have a choice if I want to work.  

Wealth = freedom, or as free as you can  be in this world

 

Yes , Dave , “ you worked it out as well 👍

[Mysstree]

I would bet good money that a majority of older workers who are past state pension age are renters. If your a renter in your 50’s the chances are you are going to be renting for the rest of your life unless you have somehow saved enough to buy a small home (unlikely) or inherit a home or inherit a substantial portfolio, the worry then would be has the deceased done enough that you dont get clobbered for inheritance tax.

When your younger you can work hard, as you age graft gets harder to do and there comes a time when your mind is telling you that you can still do it yet you body is telling you its not physically capable. If your not there yet, you’ll get there, its not overnight and sudden but as the days go by things just require more effort and more time.

Not only is having a roof over your head and owning it good for your physical wellbeing, for your mental wellbeing its a huge weight lifted.

[GrahamDiamond]

Some great comments and ideas to mull over, thanks guy,s and gal,s.