Your browser isn't supported
It looks like you're using an old web browser. To get the most out of the site and to ensure guides display correctly, we suggest upgrading your browser now. Download the latest:

Welcome to the MSE Forums

We're home to a fantastic community of MoneySavers but anyone can post. Please exercise caution & report spam, illegal, offensive or libellous posts/messages: click "report" or email forumteam@.

Search
  • FIRST POST
    • Pezz
    • By Pezz 16th Oct 16, 5:42 PM
    • 2Posts
    • 0Thanks
    Pezz
    Mortgage penalties
    • #1
    • 16th Oct 16, 5:42 PM
    Mortgage penalties 16th Oct 16 at 5:42 PM
    Hi,
    I'm in process of moving house and this should happen either December or January. I have a mortgage deal with my current lender and I am looking to change lenders. The deal with my current lender finishes on the 31st December but my last payment on this deal is the 1st December. My lender has advised that if move mortgages before the 31st December I have to pay 1% penalty even though the last payment would have already been made. Does anyone if there is any way around this?
    Thanks
    Perry
Page 1
    • dunstonh
    • By dunstonh 16th Oct 16, 5:56 PM
    • 85,120 Posts
    • 50,138 Thanks
    dunstonh
    • #2
    • 16th Oct 16, 5:56 PM
    • #2
    • 16th Oct 16, 5:56 PM
    Does anyone if there is any way around this?
    Yes. Dont move until after the penalty period has ended.

    The deal with my current lender finishes on the 31st December but my last payment on this deal is the 1st December.
    Irrelevant. You are still borrowing the money and that is subject to daily interest. The monthly payment on the 1st Dec lowers the amount being borrowed but you are still borrowing money.
    I am an Independent Financial Adviser (IFA). Comments are for discussion purposes only. They are not financial advice. Different people have different needs and what is right for one person may not be for another. If you feel an area discussed may be relevant to you, then please seek advice from a Financial Adviser local to you.
    • Pezz
    • By Pezz 16th Oct 16, 8:03 PM
    • 2 Posts
    • 0 Thanks
    Pezz
    • #3
    • 16th Oct 16, 8:03 PM
    • #3
    • 16th Oct 16, 8:03 PM
    Thanks for the replies, I thought this would be the case, I’m hoping to put the move off until Jan, just depends on the buyers.
    Regards
    Perry
    • magpiecottage
    • By magpiecottage 19th Oct 16, 5:48 PM
    • 9,133 Posts
    • 5,580 Thanks
    magpiecottage
    • #4
    • 19th Oct 16, 5:48 PM
    • #4
    • 19th Oct 16, 5:48 PM
    It may depend on the deal you are on. Generally, the penalty would be expected to reflect the anticipated loss to the lender if you got out early. It is, though, allowed to calculate this on on the basis of what might have been anticipated at outset or when it actually happens.

    If it was excessive, FOS might deem it to be an unfair term in a consumer contract. However, that is not guaranteed.
Welcome to our new Forum!

Our aim is to save you money quickly and easily. We hope you like it!

Forum Team Contact us

Live Stats

611Posts Today

3,658Users online

Martin's Twitter