Paying chunks off your mortgage balance?

spoony77

Hi people
This may seem like a silly question to some but how do i physically pay money off my mortgage?
Do i just go into my lender (Halifax) with cash for instance and say please take this off the amount I owe?
Will this come straight off the amount I see that I still owe when i check my online banking, or will some of it be lost to interest somehow !!
I understand all about early repayment fees and capped overpayments I just dont understand how you actually pay a chunk off??
For example if I owe still £100,000 and have 16 years left of a 20 year mortgage can I take £5k in tomorrow and slap it on the counter and instantly my balance would show £95,000 or is it more complicated than that?
Also if I were to do this would my monthly payments automatically reduce or would the term time reduce but the payments remain the same??????
Any help appreciated!

bigadaj

You can just pay it off, normally by bank transfer but presumably cash would be ok. You need to check there are no penalties for doing so, normally 10% or less is ok anyway per year.

You should also be able to specify whether this will reduce the term, and maintain your repayments, or reduce payments, if you make annual overpayments then there may not be much difference.

Also make sure that you won't need the money back, or clarify that this is possible with the lender. Also check what basis your interest is charged, if its monthly rather than daily then you may be better paying off at the start or end of the month.

Zero_Sum

spoony77 wrote: »

Hi people
This may seem like a silly question to some but how do i physically pay money off my mortgage?
Do i just go into my lender (Halifax) with cash for instance and say please take this off the amount I owe?
Will this come straight off the amount I see that I still owe when i check my online banking, or will some of it be lost to interest somehow !!
I understand all about early repayment fees and capped overpayments I just dont understand how you actually pay a chunk off??
For example if I owe still £100,000 and have 16 years left of a 20 year mortgage can I take £5k in tomorrow and slap it on the counter and instantly my balance would show £95,000 or is it more complicated than that?
Also if I were to do this would my monthly payments automatically reduce or would the term time reduce but the payments remain the same??????
Any help appreciated!

You're payments would drop. The term would only decrease if you specified.

This is the main reason I cancelled the mortgage DD, so I can just pay what I wanted to (the amount being greater than the minimum payment)