Paying a years mortgage in advance.

Blindsided_2

Hi, asking this for my mum and dad.
They have a mortgage on their house but due to my dads work can be out of the country frequently, they pay their council tax a year in advance but tonight we were thinking, can you pay the mortgage for a year in advance, ie 12x 390 payments.
I would be easier for them as then they know it's covered ..but I thought maybe the mortgage company might. To go for that?

Anyone know? My dad is going to ring halifax on Monday obviously and ask.

Thanks x

ACG

Depends on the lender and the product - i doubt it, but thats not to say they cant move to a different lender who would allow it.

Alternatively just leave the money in a bank account on Direct Debit.

Blindsided_2

ACG wrote: »

Depends on the lender and the product - i doubt it, but thats not to say they cant move to a different lender who would allow it.

Alternatively just leave the money in a bank account on Direct Debit.

Thanks, they are allowed 20% overpayments per year???but I don't think the bank will agree.
Yes, I thought they should just put the money into an account for direct debit but they have had issues with hsbc cancelling direct debits before, not great if your not in the country.

Sparx

Just setup a Direct Debit for the monthly amount (or with 20% over payment also??) and get them to check HSBC online banking once or twice a month to ensure all is in order and the DD is active?

DDs do not just cancel themselves. If you find HSBC incompetent get a new bank account with someone else then setup the DD through them.

maninthestreet

How do they pay the mortgae currently, if not by DD? Just leave the DD in place, and the lender will collect the payments each month. The fact your parents are out of the country won't affect the DD.

Goldiegirl

Paying in advance in the way you describe could cause problems.

By paying a lump sum of payments at once, it would put the account 'in advance'

At the lenders year end, sometimes they clear any 'advance' figure, so the account just shows on their records as 'up to date'

Therefore, when the next monthly payment isn't received in the month in which it's due, the account will then show as being in arrears.

It's much safer just to pay the direct debit each month - saves a lot of potential confusion.

getmore4less

Get an account with the lender and use that for the DD.