woolwich great escape mortgage

want2bmortgage3

hi there
does anyone else have this mortgage and know anything about the overpayments?
I've been sending overpayments now and then, still under the 10% maximum limit.
I haven't received any receipts of these but I know the balance is reducing via the automated telephone service.
I also notice the monthly payment hasn't reduced, so am assuming they are reducing my term instead?
Also does anyone know what would happen if I went over the 10% limit? Would my payment be returned?
Thanks

Morgage_Confused

Yes....theres no one great escape mortgage but a whole load of them...i think the basic idea is you can switch at any point to a fixed or capped rate, escaping the potential of rising interest rates on something like a tracker for example. Personally I think it was just a marketing toy and not really worth anything in particular to the customer especially since the rates have stayed low anyway....but I digress.

Make an overpayment (less than 3x your normal monthly payment) and you reduce capital and should be sent a letter to confirm this after about a week. This reduces your term of course but that is not officially recorded as such....it just happens by default.

Over 3x your monthly payment and all hell breaks loose. They class it as some kind of part redemption or something. They recalculate your monthly payments (sometimes taking into consideration all your other smaller payments aswell, this happened to me) and adjust your monthly mortgage payment according to the original term.(Importantly this also happens once per year when they lump overpayment's together and recalculate, i think its October time?)

All is not lost though. You can just ring them up and ask to fix your payments back up to the level you want, assuming you want to do this to keep reducing your term.

Over 10% of the capitol owing and they start to charge some kind of penalty...its not much but its significant if you suddenly pay it all off like if you win the lottery.

They can return overpayments but thats another minefield which I havent encountered personally but am aware of. Your small overpayments can be clawed back at no cost. Larger payments/overpayments can be borrowed back at SVR. Log onto your online mortgage current account and take a look at that bizarre figure. Its normally a negative number which I think represents your capitol payed off which is able to be borrowed back at SVR.

p.s. Im sure I wrote this somewhere else?

want2bmortgage3

I have phoned them to clarify how it all works, basically I'd made several overpayments, a couple over 3x normal payment and the rest under.

I haven't received any notifications of my overpayments and my monthly payment has stayed the same. However I know the mortgage balance has reduced by phoning the automated system and checking balance.

From the phone call I discovered that you have to request to have monthly payments reduced, otherwise they just stay the same and reduce the term.

I also found out that the extra current account they give you, which is a overdraft secured on your property at SVR rate of 4.99%. This is an overdraft you can borrow from via debit card or cheque book.

The main thing is, this account is seperate to your mortgage. It's not borrowing back. If you write a cheque for £1000 it wont change your mortgage balance.

getmore4less

With Barclays the overpayments on the mortgage account increase the overdraft limit on your mortgage current account

With offsets this lumped in with the offset pool so is at the same rate as the mortgage.

want2bmortgage3

I just wanted to add that my overpayments are no longer leading to an increase in the overdraft facility on the current account.

I think this is due to me closing down another barclays current account I had, it appears that now they can't see I have a regular income (it's now going to another bank current account) they wont increase my available overdraft.