Calling up the Mortgage Provider Today!

Tayus

Guys

I am going to call up my lender today and ask to up my direct debit and enquire about the possibility of making extra payments throughout the month using my debit card.

Is there anything I need to know or be aware of before I do this, or do I simply ring up and do as above?

Whats the difference/benefits between paying off the Capital and reducing the term (If any)?

chirpchirp

Decreasing the term is useful if there are overpayment limits on your mortgage. As you are giving yourself less time to pay off the mortgage the monthly payment increases in effect giving you your overpayments.

If there are no overpayment penalties then there is no need to change the term. Some banks/building societies will charge for changing the term. Hope this helps.

RosieTiger

You could also go witha Standing order if you get their details for payments.

Tayus

Hi guys

Just rang them and have increased my payments by approx £100. The lady on the phone said that I could make standing order payments but i would have to call them each month to confirm that it has gone in so i decided against that and instead I can go into any branch and make cash or cheque payments so thats good to know!

One thing that does concern me is that she said she would send the details out next week and that my payments may not increase by exactly £100 as they would have to calculate the reduced term? Does this mean that they will calculate how long my new increased payment would take to pay off the loan? Confusing myself now!!!

supersunshine

Hi Tayrus

What they will do is decrease your term to get as near to the amount as you want to pay and then confirm how much the payment will be. You may want to call them to see if they do a thing where they round up to the nearest £100. My bank does this and it makes it easier to work out what you are paying and if the rate changes it stays rounded up to the nearest £100.