N Yorks changing T&C's on flexible mortgage

hunthebun

in 2001 I took out a flexible mortgage with NYorks then part of the Scarborough now part of SKipton. The key attraction for me was the abililty to overpay and to have the sum deducted fromt the mortgage balance. Yesterday a letter arrived telling me that as of March 1st this option [and the option of overpayments to build payment holidays] were no longer available, I have to choose whether to reduce my mortgage payments or to have overpayments applied to the term.

They've tried to call me twice in 24hours to get my decision - I'm not happy - they're telling me over the phone that it's an admin issue and that there is no difference to my ability to overpay - but there clearly there is. On the advice of the FSA I've asked where in T&C's they can do this and they're coming back to me on that. Anything else I can do?? Thanks

hunthebun

sorry can i also ask - what is your understanding of the difference between overpayments off the balance and overpayments off the term??

beecher2

I don't understand - the sum will be deducted from the mortgage balance whichever you choose. You can either keep the payments the same and reduce the term, or keep the term the same and reduce the payments. Is the change maybe just to the ability to take payment holidays?

Could you maybe quote the letter directly>

luckyfool

Yes, I'm not clear as to how their change is going to disadvantage you?

hunthebun

i'm not sure of the difference or of the impacts either that's why I'm asking really.

Basically the letter says - you [currently] have had four options for overpayments
1 - O ... allow a future reduction in your monthly mortgage payments
2 - O.... allow a future reduction in your mortgage term
3. O... allow a potential future mortgage holiday
4. O... which would reduce the mortgage balance, however your monthly mortgage repayment would remain the same.

with effect from 1st March - option 4 will cease and your monthly mortgage payment will change. ... you have the following options..
1. you may reduce your mortgage term
2. you may reduce your mortgage payment

Is anything really changing here???? Is it going to impact on me at all?? Thanks - sorry I don't realise understand the difference in what is on offer vs what i had..

.. blah blah

dimbo61

If it was me I would reduce the mortgage term and keep my payments the same!
Why ? because you have paid that amount for the last few years ( without problems ?)
The sooner you pay off the mortgage the less interest you pay !
You now need a savings fund ( emergency pot of 3/6 months of income in cash ISA,s ) seperate from the mortgage