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Understanding mortgage settlement and ERC

Chin
Chin Posts: 146 Forumite
edited 25 May 2016 at 5:33PM in Mortgages & endowments
Hi all

Hoping you can help me understand a situation.
Our house is under offer and we have an ERC to pay if we end mortgage prior to 30th Sep.

Our completion date looks to be pencilled in for middle of Sep and we are moving into rented accommodation.

Could someone pls help me understand if I can keep paying the mortgage on a property which is sold to pass the 30th Sep date and avoid paying the ERC? It'll mean 1 month of continued regular payment.

Is this possible to do? Or will the lender require their cash as soon as the property is sold?

Thanks
«1

Comments

  • TrickyDicky101
    TrickyDicky101 Posts: 3,534 Forumite
    Part of the Furniture 1,000 Posts
    The lender will require the funds to be paid back on the completion date so you would be best advised trying to negotiate the completion date to be after 30th Sep.
  • Chin
    Chin Posts: 146 Forumite
    Balls. Thought this might be the case.
    Delaying completion isn't an option which is frustrating.
    Thanks for the help
  • Lokolo
    Lokolo Posts: 20,861 Forumite
    Part of the Furniture 10,000 Posts
    You may want to re-look over the terms of the mortgage. Only because on my fix its 3% in the first year, 2% in the second year the only 1% in the final year.

    Obviously can't say this will be same as yours, but a lot of them seemed the same throughout my mortgage search.
  • Chin
    Chin Posts: 146 Forumite
    Thank you. Unfortunately it's 3% in the final year.
    Looks like I may have to see if I can slightly delay completion as it's unfortunate to have to pay such a large sum for just a month.
  • JimmyTheWig
    JimmyTheWig Posts: 12,199 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Combo Breaker
    Chin wrote: »
    Delaying completion isn't an option which is frustrating.
    Even if you drop the price by, say, £3k?
  • amnblog
    amnblog Posts: 12,761 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Photogenic
    Are you not taking a new mortgage?
    I am a Mortgage Broker

    You should note that this site doesn't check my status as a Mortgage Broker, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.
  • Chin
    Chin Posts: 146 Forumite
    amnblog wrote: »
    Are you not taking a new mortgage?

    No, moving into rented for a while.
  • amnblog
    amnblog Posts: 12,761 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Photogenic
    Sounds like you've shot yourself in the foot then.


    I hope it's worth it.
    I am a Mortgage Broker

    You should note that this site doesn't check my status as a Mortgage Broker, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.
  • Chin
    Chin Posts: 146 Forumite
    amnblog wrote: »
    Sounds like you've shot yourself in the foot then.


    I hope it's worth it.

    Don't really know what this means or if it's supposed to be helpful!
  • Thrugelmir
    Thrugelmir Posts: 89,546 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Photogenic
    Chin wrote: »
    Our completion date looks to be pencilled in for middle of Sep and we are moving into rented accommodation.

    Then should be easy to lose 10 days. Book a holiday and make yourselves unavailable.
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