Fixed rate mortgage question - sorry if it's obvious!

carmen_blue

We're trying to sell our house. We have a fixed rate mortgage. The fixed rate is up in September. This may be a really stupid question, but let's say we sell before then - in July, for example and so we move out in July. Can we just hang on to the money and continue to pay our mortgage as normal until the date we can pay it back without penalty? Or are we supposed to be technically living in the house?

beecher2

No, you can't. Once the house is sold the mortgage will be redeemed. You'd possibly be able to port it if you had another house lined up, but otherwise you may have to pay an Early Repayment Charge if you sell before September.

_Andy_

When you sell, the mortgage will have to be redeemed. So yes you'd incur the ERCs (I'm assuming you're not porting the mortgage to a new property)

_Andy_

Beaten to it by beecher

Pincher

Your stand point: 3 months interest is less than the ERC

Lender's stand point: 3 months interest is less than the ERC

What would you do if you were the lender?

jizadine

I wouldn't worry about it - 12 weeks to turn around a sale - plus you haven't even got a buyer yet...

Evilm

Agree with the above poster - by the time you are ready to complete it will probably will be September. You could always advise right from the start that you want the completion date to be no earlier than your fixed period end date, most people won't mind that too much as it will most likely only affect it by a couple of weeks at the most over even the quickest turnaround.

carmen_blue

Thank you, everyone. Great advice - I get it now! I agree, it would probably take until Sept for the sale to go through. And considering we don't even have a buyer yet, even that could be wishful thinking...