Mortgage free or leave £1

tiernsee

I've been planning on being mortgage free at the end of this year but I've reassessed finances and decided that I can clear the remainder of the mortgage (circa £30k) this week

However, I was talking to my parents and they suggested I should leave a £1 on the mortgage as this would mean that the bank would look after the deeds and it would mean that if I did want to borrow again the facility would be in place?

I'm hoping that fellow MSE may share their thoughts and advice with me - all would be welcome and appreciated.

After £20k negative equity on top of the mortgage (at peak an additional £105k), I can hardly believe that the end is in sight!

Many thanks

Jonbvn

Keeping the deeds is no longer relevant, since they are held electronically by the Land Registry.

The ability to relend if you get the mortgage "open" depends on the T&C's. Most mortgages will not just let you draw down funds at any time you want.

ernie_3

tiernsee wrote: »

I've been planning on being mortgage free at the end of this year but I've reassessed finances and decided that I can clear the remainder of the mortgage (circa £30k) this week

However, I was talking to my parents and they suggested I should leave a £1 on the mortgage as this would mean that the bank would look after the deeds and it would mean that if I did want to borrow again the facility would be in place?

I'm hoping that fellow MSE may share their thoughts and advice with me - all would be welcome and appreciated.

After £20k negative equity on top of the mortgage (at peak an additional £105k), I can hardly believe that the end is in sight!

Many thanks

:TGood for you..must be a great feeling..great to hear some good news:T today

mau408

I suppose it depends on who your mortgage is with. I agree with jonbvn all together however there is a mortgage fee payable at the end of our mortgage with Halifax of £115 which someone explained that if you keep reducing the term and overpaying without any fees EXCEPT the last payment then this fee is not payable as you've let the mortgage run its course.

Hopefully this helps.

hertsbet

I've been trying to achieve mortgage free status by 40. I can make the last £15k payment in the next couple of weeks and i'm 40 in 3 weeks....:beer:. The Nationwide have offered the chance to keep my mortgage account open with a £1 balance and this is interest free. Otherwise I can close without charge. I know the deeds aren't an issue, and i'll still be a 'member' of the society but is there any other point keeping the £1 balance?

If in a couple of years I decide to get another mortgage, will it be easier with a mortgage account 'open'?

Good luck to everyone on this journey, I'm sure you will be at the to close/not to close 'problem' soon:T

pencekeeper

Yes, if your mortgage is with Nationwide then keep the balance at a nominal 1 pound:

- you'll pay no interest at all
- you won't have to get a new mortgage in the future you can take it with you - and Nationwide no longer offer the BOE +2% rate to new products
- you can still close at any time (and probably won't even have to pay that 1 pound at all if you do)
- you can borrow back at any time for low interest loan (though newly taken out Nationwide mortgages don't offer you that)

It's what I'm planning to do. Just ring them and tell them that's what you want to do and they'll give you an exact figure to pay.

Andiejt

Hi, We paid off our mortgage a couple of years ago which was with Nationwide and they said about leaving it open with a pound etc. We decided not to and personally I'm glad we didn't now, purely for the reason that our house feels completely ours and no one else has a claim on it, even if it is only £1!

zfrl

Jonbvn wrote: »

Keeping the deeds is no longer relevant, since they are held electronically by the Land Registry.

The ability to relend if you get the mortgage "open" depends on the T&C's. Most mortgages will not just let you draw down funds at any time you want.

The information is only held by the Land Registry if you have registered it. If the property has not been sold since this came into effect it will not be registered. Can't remember when this was though!