mortgage with hefty early redemption

Nells

we bought our house not long ago with 2 years fixed but with a hefty 7k early redemption penalty. turns out we hate the place and want to move but dont want to pay this 7k obviously. does anyone have any ideas on how to get around this? i know we have been stupid but hey who hasnt at some point.

roswell

Dont think you get round it as it will have been in the T&C`s and the contract you agreed to. The way i see it you hve the following options.

1) Wait it out.
2) Pay the fee.

If you cant do option one you will have to bite the bullet and do option 2.

A_Nice_Englishman

Ask your lender if they will waive or reduce the penalty if you take out a mortgage on the same T's & C's on a new property.

Nells

Thanks. I've just been reading the Ts & Cs and I think we will need to wait it out, rent it out or pay it!! I had thought it was portable but it isn't!! God knows what we were thinking at the time!!

A very expensive and valuable lesson learned!!

A_Nice_Englishman

Ouch!

If you do decide to sit it out you will at least be benefiting from the 2 year fix as interest rates have just risen and many people think they will continue to do so.

There would be no harm in asking them about portability though. They might just agree even if it isn't in the T's & C's.

MEGANJODELLE

I made a similar mistake to this. I bought a place and wanted to go almost immediately - I have awful neigbours. When I checked my T & C's I was shocked to read that my redemption charge is £3000, I was expecting it to be on a sliding scale and be down to a few hundred by the time the 3 year term was almost up. I am amazed I was so gormless to miss this in the small print as I'm mean't to be quite a switched on person!

Like you say, a valuable lesson learned. When I thought about moving and paying the £3000 charge, I just thought about how long it would take me to earn or save that amount of money. Was I really prepared to throw it away? Hell no!! However, I suddenly felt alot better because I had control of the situation again. I can move if I want to, but I have chosen not to, until my deal ends. I have also heard about mortgage deals where there is no lock in. I may well go for one of these next time so I can always move on my own terms. I appreciate you pay a little more but it will still be a better deal than any standard variable rate.

On a final note, you don't say why you hate your property, so maybe your situation is differen't to mine. However, I get round it by hardly ever being there. I have two jobs, so work 6 days a week and go to the gym 3 nights a week. I then spend Saturday with my Dad so I'm not really exposed to what's making me want to move. Of course, your situation may not allow this, but it may be worth considering. It has also given me a quarterly electricity bill of £4:53!!!!Cool or what??!!!!

Good luck in whatever you choose to do.

x

Nells

we do have a diff situation but funny enough because of shiftwork etc and visiting friends and family we dont spend so much time here so prob try to sit it out although sometimes life is too short isnt it? thanks for your replies - all help most appreciated. in fact think we will contact BS and ask about portability or waiver.....

ohmsoft

Many lenders will allow you to transfer the T & Cs to a new property - may i ask who you are with?

Nells

well that is another story. we had defaulted once long ago on a loan and this has caused us no end of probs with the credit checks etc so we had to get mortgage from sub prime called Rooftop (or did we?). paying 2 years fixed at 5.5 interest only at the moment. can you or someone tell me when you eventually get back onto normal lenders again cos this is just ridiculous!! we have 2 successful BTLs, jobs, the lot and still we are being punished or that is what it feels like!!

TEDDYRUKSPIN

As above, port the mortgage to the other new property? How much are you are owing on the property? You should be able to but if not, can't really say what you can do. Pay off the redemption or stick it out on the horrible property you are saying.

Paulxo

Similar thread to one I've started on page 1 Redemption Fees - Are They Legal, have a look.

Some say you can get them back.