Leaving a small amount in account, OK?

HardSpend

Hi

I was thinking about paying off my bank of Ireland variable rate mortgage since there's only about £2600 remaining. Thing is there is £195 in fees to pay when you do so I thought I might leave like £50 on it so my deeds are safe at the bank and I can avoid paying the redemption fee for a few years until my mortgage term runs out. What do you think? Just wanted to check there is nothing wrong with this.

Cheers

libf

Pretty sure my parents left their mortgage account open with a minimal amount in it (like £1) for a while in case they wanted to borrow a bit more again at some point.

Goldiegirl

It's an idea to keep the mortgage open if you think you might want to borrow more money at some point.


But, as long as the property is registered at the Land Registry, you don't have to worry about keeping the Deeds safe - they are just historical documents now, as everything is held electronically.


You might find that the lender charges a fee to close the mortgage even at the end of the mortgage term

HardSpend

Thanks for replies. Didn't realise everything was electronic. I do still have to pay the fee but would rather do it at the end of the term in 3 years time. They would not tell me the exact value (this is only done by mail, how odd?), only to the closest £100 when rounded up so I paid what I think should leave about £50 in it.

Thrugelmir

HardSpend wrote: »

They would not tell me the exact value (this is only done by mail, how odd?),

It would have to be calculated manually. As interest is accrued daily but charged monthly to the account. So not visible to a customer services advisor on the telephone. If the advisor were to quote the wrong figure then the ramifications could leave the lender in a loss making position.

HardSpend

Any idea what would happen if I over paid the value?