Early Redemption Charge Issue

bigbuckers

Hi,

We very recently remortgaged (Dec 2011) as our deal was coming to an end. We managed to get a reasonable fixed rate from Leeds so went ahead and got it agreed to avoid being put on the RBS SVR. With hindsight we should have just taken the hit of the higher RBS rate as we have just managed to sell our house! We now face a large redemption fee from Leeds as they were unwilling to lend the required amount so we need to go elsewhere for our mortgage and have been informed that other lenders will be fine to lend the amount we need.

Is there any way we can avoid the full redemption amount of around £8000? Would porting be cheaper? We were told by our broker that porting could incur a cost of around 10% of the mortgage which would be significantly higher than the 8K redemption charge.

We do feel foolish but at the same time we hadn't realised that Leeds lending criteria would be so tight thus restricting our next move. We could hold off moving until the end of the deal but then our fear is that we'll lose the money we've made on our house and the gap to the next level will have widened. We are also incredibly keen not to mess our buyers around so don't want to have to pull out so will swallow the £8k charge if absolutely necessary.

I realise this sort of question probably comes up often and apologies if it has been answered elsewhere but any advice would be gratefully received.

Thanks
B

ACG

Ive got a client at the minute who doesnt want to pay her ERC either. I spoke to the lender and they have said she can write in to see if anything can be done. No promises but its worth a try.

bigbuckers

Many thanks for a prompt reply ACG I'll certainly give that a go.

kingstreet

bigbuckers wrote: »

We now face a large redemption fee from Leeds as they were unwilling to lend the required amount so we need to go elsewhere for our mortgage and have been informed that other lenders will be fine to lend the amount we need.

Is there any way we can avoid the full redemption amount of around £8000? Would porting be cheaper? We were told by our broker that porting could incur a cost of around 10% of the mortgage which would be significantly higher than the 8K redemption charge

Porting involves taking the new mortgage from your existing lender. You appear to have exhausted that option already if Leeds won't lend what's required.

opinions4u

I'd be amazed if they waived it.

Why did you choose a mortgage with such a big penalty in these circumstances?

betmunch

did you know you were moving when you remortgaged? And if so did you tell your Broker? If he knew I would consider recommending the Leeds deal as awful advice, he should have recommended something without penalty to pay off, or checked that they would lend enough when you ported three months later!

bigbuckers

Thanks all, it was definitely a mistake on our part but our house just was not selling so we took it off over Christmas which is when we remortgaged to the Leeds deal. Still, we all have circumstances that change and that's what happened with us. I was just hopeful that there would be a way to at least part waive the fee. We will be trying the letter.

Thanks to you all for your advice.