Ideas of how to get round redemption penalty?

skysky69

OK, a long shot I know.
I have my mortgage with the TMB and in the next couple of weeks we are getting valuations to put our house on the market. Our fixed rate finishes in August and even if we sell the house relatively quickly after it goes onto the market I can't see it going through until much before then anyway. BUT, having just been told my redemption figure, they have said that there is a redemption penalty of £5,800.00 :eek: Now, if a) I manage to find a buyer and b) it goes through relatively quickly, if we have to move out say June or July, could I not just pay them three more mortgage payments up front which will be cheaper than this penalty.

We moved in on the 7th August 2005 and our completion date was 6th August but he just said that our fixed rate does not expire until 31st August which means that they seem to be holding us in for an extra month too - any ideas on this one too?

Many thanks for your help!

LisaT186

As regards to the extra month, it was probably a product that had an end date applied instead of 2 calender years length, quite common. you could always ask them about paying the three months and see what they say, can't say I've had anyone do this.

When you sell you could stipulate that you are unable to move out until 31st August, so any potential buyer is aware of the time scales?

As a last resort is the product portable to a new property?

skysky69

Product is portable but we are going to rent for a while we get our finances all sorted. Will have to ask them nicely - TMB are part of the halifax and all my bank accounts are with them - they have enough out of me as it is!

regularsaver1

I don't think they'd except you paying 3 monhts upfront

you are repaying mortgage early

how long do you plan to rent for?

TMB are separate to Halifax, just because they are part of HBOS

Kaz2904

If it is only a short time that you plan on renting for then you may well find that they will refund your redemption penalty. We had a 10 week gap between sale and purchase and had to pay the penalty but were then refunded when we got the mortgage for the house.

regularsaver1

Thats why I ask - I know Halifax is about 6 months

pknottm

Coventry BS allowed me 6 months between redeeming my old mortgage and completing on my NEW house to refund the redemption penalties...

david29dpo

you will not be able to pay the mortgage after you have sold! if you sell quickly, just delay completion until the penalty runs out. but tell the buyer why.

dwight-van-man

You could always increase the sale price by 5k......