Any disadvantages?

Just wondering if there are any disadvantages to being mortgage free.

1) I have heard that it can have a negative impact on a credit score - is this the case if you have other credit e.g. credit cards paid in full each month, 5% car loan paid each month? Will it make it more difficult to get a mortgage in future if you want to get money for house renovations or moving to a new place?

2) Do mortgage companies still hold the deeds, and without a mortgage company is there a need to pay for secure storage of these?

Replies

  • edinburgheredinburgher Forumite
    13.1K Posts
    Part of the Furniture 10,000 Posts Name Dropper
    Forumite
    1. Not really, credit scoring is far more sophisticated these days than just mortgage? yes/no. Employment, credit history and affordability are more important.
    2. Can't speak for all companies, but [email protected] sent ours back to us very quickly into the life of our mortgage, I get the impression that lenders are less keen to hold the deeds these days?
    Mortgage Neutral Wannabe
    Mortgage £211,712.80 vs LISA £307.11
  • ZTDZTD Forumite
    24.3K Posts
    Forumite
    2. Can't speak for all companies, but [email protected] sent ours back to us very quickly into the life of our mortgage, I get the impression that lenders are less keen to hold the deeds these days?

    I believe the land Registry holds everything electronically, and so deed are just useless bits of paper, so are of no interest to banks/building societies. However, for hysterical raisins, people like deeds (sometimes they have info on exact boundaries) so are keen to keep them.

    Just keep them in a fire proof box and they will be fine - no real loss if they are lost.
    "Follow the money!" - Deepthroat (AKA William Mark Felt Sr - Associate Director of the FBI)
    "We were born and raised in a summer haze." Adele 'Someone like you.'
    "Blowing your mind, 'cause you know what you'll find, when you're looking for things in the sky." OMD 'Julia's Song'
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