Bank has reduced mortgage payments after lump sum overpayment

Greenst

I have added this to the post below by "Collison" but have thought its maybe better to start a new thread so people don't have to read back through the other post to get to my question!

Just heard from my friend she paid an overpayment lump sum on the mortgage but now the mortgage company have reduced her monthly payments, which is now defeating the object a bit. They haven't reduced the monthly standard payment all the time she's paid her 10% monthly but now she's paid it as a lump sum they have! Is it just a matter of calling them and getting it put back to the original amount? Is this standard procedure? She wasn't asked if she wanted to reduce the payments or even the term which is currently 10 years.
Any advice most appreciated she's at work today and can't make calls or personal "stuff"

Sorry if anyone's replied on other thread but I thought this may get some quick replies. Thank you in adv advance.

ACG

Just call the lender.
When I worked for a lender we used to ask if they would prefer the payments or the term to reduce - job done.

Greenst

Ok well that's easy then ?y?? You'd think the bank/lender would have asked or given the option/choice though as you say you used to do. Bit cheeky I think ! Will let her know! Thanks

martinsurrey

my bank reduce the monthly payment after any lump sum repayment.

you have to ask them to reduce the term, and pay an admin fee

http://bankofirelandmortgages.co.uk/existing-customer/residential/manage-your-mortgage/overpayments

Goldiegirl

Can't she just pay more than the monthly payment?

If she pays more than she needs to, the term will reduce, there's no real need to get it done 'officially'

must_try_harder_2

Goldiegirl wrote: »

Can't she just pay more than the monthly payment?

If she pays more than she needs to, the term will reduce, there's no real need to get it done 'officially'

I agree with this. She can pay extra every month but if she officially gets the term reduced she won't be able to change it back easily later and you never know what will happen and when you'll be grateful for lower basic monthly payments (if she lost her job or was ill for example).

RADDERS

But if she has paid her 10% overpayment limit she may get penalised for any further overpayments in this period.

Greenst

yes that was the 10% limit. on a five year fixed deal