ERC if not buying again.....

ise_2

Hi,

I know there have already been various discussions on Early Repayment Charges but we have a slightly different case. With a year to go on our fixed rate we have sold our property and are wanting to get out of our mortagage. Obviously our ERCs are high but we have heard a rumour that if you are not going to take on another mortgage for the same amount of time that you were tied in, you can get out of paying it. Eg, If you have a fixed rate for 5 years and are only 3 years in when you want to come out but dont want to buy again for another 5 years you don't have to pay.

Does anybody know if this is true as I have been through all our mortgage documents and can't find anything about it but we are looking at going abroad for the next few years anyway so this could work out nicely for us...

Thanks

silvercar

Never heard of that.

If you redeem while ERCs apply, you have to pay them. If you are buying again some lenders will refund you the ERCs on the new purchase, but there is only a small timespan in which they will do this - usually 6 months max.

beecher

Doesn't sound very likely to me - how would your lender know if you'd taken on another mortgage within the 5 years, and what would be in it for them? Best bet is to phone your lender and see what they say, but I can't imagine they'd agree.

_Andy_

That isn't true. You will have to pay them

Daggit

I would give them a call and see if they are willing to wiave them. We are currently buying another house but taking a mortgage with a different bank and our original one is waiving the ERC which they have confirmed in writing saving us about £6000!! So worth asking.

dunstonh

We are currently buying another house but taking a mortgage with a different bank and our original one is waiving the ERC which they have confirmed in writing saving us about £6000!!

There are only a small number of lenders who are waiving the ERCs and thats an incentive to get shot of you. Who was your lender?

ise_2

dunstonh wrote: »

There are only a small number of lenders who are waiving the ERCs and thats an incentive to get shot of you. Who was your lender?

Our lender is Leek Utd....
Thanks everyone for your advice so far

jamesd

If your mortgage is portable you'll have more chance than if it's not, because you could buy a new property. A better way around to have done this would have been to contact them pre-sale and ask them if they are interested in waiving ERC if you remortgage or move. If the fixed rate you're on is a poor deal for them they might accept. The problem now is that you're committed so it will seem to them that you're going to leave anyway, so no need for them to make a concession.