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Borrow Back Loan
I have a mortgage with Nationwide which I have been overpaying, total so far about £27000.
I have until June next year to pay off the mortgage, but it is my intention to pay off the outstanding amount of £10500 at the end of this month.
After paying off the mortgage I would like to then borrow approx £25000 over 5 years. This would be for mods to the house and a new kitchen etc.
Having checked with Nationwide with regards to a loan they informed me that I could have a 'Borrow Back' of the overpayments I have made instead of a loan. They said I could phone up and arrange this quite easily.
They didn't offer any figures for this and their website tells you nothing about it either, just offering a phone number to call to set this up.
I've never heard of this sort of thing before so am a bit wary it may cost me more money in the long run.
Does anyone know of this and wether it would work out cheaper than just paying off the mortgage and having a loan?
I have until June next year to pay off the mortgage, but it is my intention to pay off the outstanding amount of £10500 at the end of this month.
After paying off the mortgage I would like to then borrow approx £25000 over 5 years. This would be for mods to the house and a new kitchen etc.
Having checked with Nationwide with regards to a loan they informed me that I could have a 'Borrow Back' of the overpayments I have made instead of a loan. They said I could phone up and arrange this quite easily.
They didn't offer any figures for this and their website tells you nothing about it either, just offering a phone number to call to set this up.
I've never heard of this sort of thing before so am a bit wary it may cost me more money in the long run.
Does anyone know of this and wether it would work out cheaper than just paying off the mortgage and having a loan?
0
Comments
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it may well be an excellent deal : presumably you pay at the mortgage rate
well worth finding out the details
what would the loan option cost?
and of course you may not be guaranteed to get it at a low rate0 -
Just had a quick google of "nationwide borrow back facility" and found this as one if the responses.
This is from their website about mortgage overpayments in the support section:Borrowing back overpayments
You may have the option to borrow back all or part of the overpayment reserve. Any overpayments will have already reduced the balance outstanding, so when it is borrowed back the balance will increase.
If you would like to borrow back funds call us on 0800 30 20 11.
Not a lot of detail but at least it sounds legit.0 -
what would the loan option cost?
With Nationwide the loan would be 3.9% over the 5 years.
Current mortgage rate is 2.5%
Don't know at the moment what the Borrow Back would be. I have asked at the local branch but they said I have to phone up the number they gave me as they don't do it in branch which does seem strange.0 -
If you would like to borrow back funds call us on 0800 30 20 11.
Yes thats the number they gave me.0 -
ring them and find out; get it from the horses mouth
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Surely the borrow back option wouldn't change your term, so you'd find yourself needing to repay it all next June?0
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