Halifax Mortgage Overpayment

jimmeee

Hi there,

I'm trying to overpay my Halifax mortgage that I took out last year.

The terms say that I can overpay up to 10% without any penalties in any rolling 12 month period.

I phoned up the Halifax and what the advisor told me is that they basically "look back 12 months from today" to work out what you can overpay. I didn't quite understand this - can anyone shed some light on this?

Hypothetically, if I took out a mortgage on 1 July 2012 for £100000. Lets say I made my first overpayment on 1 Aug for £1000. Does this mean I now can repay another £9000 until 1 Aug 2013 before it resets again?

This is how I thought it worked but I didn't understand the "rolling 12 month" part.

Any info would be much appreciated.

Thanks

Jiimmy

ValHaller

jimmeee wrote: »

The terms say that I can overpay up to 10% without any penalties in any rolling 12 month period.

I phoned up the Halifax and what the advisor told me is that they basically "look back 12 months from today" to work out what you can overpay. I didn't quite understand this - can anyone shed some light on this?

Hypothetically, if I took out a mortgage on 1 July 2012 for £100000. Lets say I made my first overpayment on 1 Aug for £1000. Does this mean I now can repay another £9000 until 1 Aug 2013 before it resets again?

This is how I thought it worked but I didn't understand the "rolling 12 month" part.

Your hypothetical understanding is correct. The rolling 12 month part is just a small step of understanding.

Suppose your 2nd overpayment was £4000 in December 2012 and your 3rd was in May 2013. The rolling 12 months means you could overpay just another £1000 between August and December 2013, a further £4000 between December 2013 and May 2014 and a further £4000 between May and August 2014

jimmeee

Thanks ValHaller. I think I understand now.

It seems like I apply the following:

1. I subtract 12 months off today to get a start date
2. My end date is today.
3. I add all over payments from start date to end date = total overpayments.
4. The total overpayments cannot exceed 10% of my mortgage amount (e.g. this would £10,000 in the above example).

Is my understanding correct?

Do you know if the 10% number is always calculated off the full mortgage amount (e.g. R100k) or is based on 10% of the balance at the start date?

Thanks again! :T

akamustang

It's usually calculated from the start date.

ValHaller

jimmeee wrote: »

Is my understanding correct?

Do you know if the 10% number is always calculated off the full mortgage amount (e.g. R100k) or is based on 10% of the balance at the start date?

Your understanding is correct. Whether it is 10% of initial or 10% of currently outstanding could vary between lenders - so check with yours.

money_maker_3

Just so you know, when you change to the new T & Cs the 12 month period will be january to December and not a rolling 12 months