ERCs- Early Repayment Charges - early exit fees. (merged).

wolboy

Thanks for the reply guys.

What happened was my girlfriend had an abbey mortgage for around 14 months there erc period i do believe is 2 years.
We have a mortgage advisor and i have been asking them exact questions you have stated and asking my girlfriend to chase him up on this. He is normally really good and has helped her in the past but we never seem to get an answer back at all.
We are not porting the mortgage it is a new mortgage just with the same bank which is abbey. The old mortgage was 147k which will be paid off when the sale of the flat goes through and we are due to move in the new house which is 249,995 at the same time both chain free.
All i was looking for as i know its a new mortgage was some sort of incentive of sticking with them if you can see what i'm saying. I dont think its to much to ask loyalty wise to maybe get it halved e.t.c. As yet still heard nothing and i have asked her to chase the mortgage advisor on this because it seem's he may not have put it to abbey when completing our new mortgage and if thats the case i dont see much hope unless they have a charitable bone this time of year :-)

dunstonh

We are not porting the mortgage it is a new mortgage just with the same bank which is abbey. The old mortgage was 147k which will be paid off when the sale of the flat goes through and we are due to move in the new house which is 249,995 at the same time both chain free.

This is why there is an ERC. If the mortgage was ported and a new deal bought only on the incremental amount then you would avoid the ERC.

All i was looking for as i know its a new mortgage was some sort of incentive of sticking with them if you can see what i'm saying.

ERCs exist as there are charges to the lender when you redeem a mortgage deal. So, they pass much or all of them on to you with the ERC. Changing deal still incurs those costs.

I dont think its to much to ask loyalty wise to maybe get it halved e.t.c.

You can ask but there is no entitlement. You may get lucky but they are quite within their rights to say no.

If anything the mortgage adviser is at fault for not porting the mortgage. At minimum they should have costed the difference to you. If they did and and you recovered the charges over the term of the old deal period still remaining then the advice is fine.

wolboy

Thanks for the advice i appreciate it, Still waiting to hear back from Abbey my Girlfriend is talking to the mortgage advisor about this as well so I will keep you informed of any developments thanks again.

Wayne

MarkyMarkD

I don't think you have any chance at all of getting the ERC reduced. There appears to be no reason at all why you were not advised to port the existing mortgage, to avoid the ERC. So why should Abbey do anything when there was a perfectly good method for you to avoid the ERC?

wolboy

That probably has something to do with the fact the mortgage on the flat was £147k Tracker Mortgage and the new one is £210k with a 40k deposit put down i believe we couldn't do it on the same rate otherwise it would have been ideal.
All I was asking was information on erc charges as i'm not to familiar with them and seem's daft to be honest to incur them when your staying with the same bank for possibly another 25 years.

DarkShadow

Hello,
We bought a house in Dec'07 @ £215,000. Our outstanding mortgage presently is £155,600.

Our 2 yr fixed is coming to an end 2-Feb. Problem is Abbey have said that they can offer us a deal for 3.99% for 2yr fixed with no booking. The only condition is that we need to make a capital repayment of £16,000.

My question is if I make the capital repayment of £16,000 that would be effectively more than 10%. Are we liable for any early repayment charges ??? I was looking at Abbey's ERC terms but I cannot understand a thing, if someone could help, that would be great. Thanks.

DarkShadow

dunstonh

My question is if I make the capital repayment of £16,000 that would be effectively more than 10%. Are we liable for any early repayment charges ???

Yes. you would be liable on the amount over the allowed repayment.

Abbey may waive it but they dont have to.

DarkShadow

Thanks, my question was

Will 3% be charged on £440 ? (£16000 - £15560)
or
Will 3% will be charged on £155,600 ?? If this is the case, then big issue.

colinmitch

Are there any controls on these charges, as I am stuck with an ERC of 6% for the full 3 years, with no reduction over time. (I have only 8 months left of the 3 year contract)

dunstonh

colinmitch wrote: »

Are there any controls on these charges, as I am stuck with an ERC of 6% for the full 3 years, with no reduction over time. (I have only 8 months left of the 3 year contract)

Yes there are controls. If you dont want to be tied in for a period then dont buy the special terms.