Mortgage Redemption Penalty

carlcarl1

Hi,

Can anyone help me?

I have a discounted mortgage with a 1% redemption penalty until the end of
this year. I would like to switch to an offset flexible mortgage with my current
provider. I've spoken to my current provider over the phone, and they've
stated that this switch would incur the redemption penalty.

Is this correct? I thought that a redemption penalty is only paid if a mortgage
is repaid, rather than a change of product.

Thanks,

Carl

PBA

Technically you'd be repaying the product you're already on and taking out a new one, so yes the charge would apply.

dunstonh

Early redemption charges are quite correct when you have taken a special offer.

If you could change product without charge you could take 4% cashback and change to variable and then back to cashback every few months.