Ing/barclays transfer advice please

eddiemacthedog

Got a letter this morning from barclays saying transfer will begin on the 16th of April. I gave them a phone and they said my lifetime tracker will transfer straight across which is fine .9 percent plus boe rate.
Question i have i have overpaid this from day one and have a payment reserve of 22-23k, now as i understand it this can be used if i wish to take a payment holiday etc, this reserve has been built up as i pay £1000 a month instead of the contracted amount which is a lot less. I asked about the overpayment reserve and was offered to use it to reduce the term or use it as a capital repayment, im slightly confused as im overpaying which indirectly is reducing the term but not sure what is meant when she offered the capital repayment as my balance shows the amount left with the reserve off the balance as well, can anyone help and advise if there are savings to be had using this capital repayment using my reserve?? Really confused

Thrugelmir

When the mortgage transfers to Barclays the "reserve" may well disappear.

Appears the options on offer are to

1. Reduce the term of the mortgage to take account of the overpayment. You will continue to pay the same standard amount.

2. Maintain the existing term of the mortgage, and pay a reduced monthly amount for the remainder of the mortgage term.

getmore4less

I spoke to someone in Barclays a week ago about reserves and they are trying to get rid of them.

We have a reserve with our offset and currently is has not been changed but others on here have reported their reserves have been removed or reduced.

With that rate you could invest elsewhere at a higher rate, might be worth considering grabbing it back if you can if you can't sort out what Barclays will be offering for reserves.

eddiemacthedog

the advisor did say that i cant get the money back, i get the part for using it for underpayments/holidays etc but i was thinking of saying to them just to pay it off as a capital repayment unless someone can think of a better idea.

Thrugelmir

getmore4less wrote: »

I spoke to someone in Barclays a week ago about reserves and they are trying to get rid of them.

Can Barclays mortgage system cope with them?

getmore4less

Thrugelmir wrote: »

Can Barclays mortgage system cope with them?

yes,

They are built into the mortgage current account as an overdraft limit that increases as you overpay, actually as you pay as well which is one of the problems they are trying to solve.

You just borrow back the money, for offset customers it's at the mortgage rate(part of the offset pool) for regular mortgages at the SVR(or Barclays equivalent).

Very handy for offset customers as you can hide your savings and keep below the benefits limit and still get at the money(until Barclays shut down reserves for good).

ethank

As they probably have thousands of ING Direct customers to migrate to Barclays products, they want to make it nice and easy for themselves.

Thrugelmir

ethank wrote: »

As they probably have thousands of ING Direct customers to migrate to Barclays products, they want to make it nice and easy for themselves.

Also for commercial reasons. Barclays wouldn't want customers drawing down on their reserves at an interest rate of 1.4% currently.

eddiemacthedog

any other thoughts on what i should do?

Thrugelmir

Choice is yours.

Stratus

I have the same mortgage product but haven't received that letter yet. The original terms and conditions include the following:

40 Our right to transfer the mortgage
40.1 Unless the agreement says otherwise, you must not transfer the agreement to any other person. We may sell and transfer our rights and responsibilities under this agreement to any other person or business at any time. We may (but do not have to) give you at least 30 days’ notice of this. We may also transfer any related rights or interest under the mortgage deed. If we transfer any of our responsibilities, we will make the other person or business take on equivalent responsibilities towards you.
40.2 If we sell and transfer any or all of our rights, benefits or responsibilities, your own rights and responsibilities under the agreement will stay the same.

In would be interesting to hear what Barclays say in response to that.