Early repayment charges

Laura1980

Hello, we are currently with Barclays and due to lots of different reasons we are having to sell up. The early repayment charge is stated as 1% of the balance repaid for the initial 2 year period


Forgive my stupidity but what does that mean? Is that 1% of our payments during that time (£585 per month)?


Thank you!
Laura

[Deleted User]

1% of the outstanding mortgage.

Laura1980

Thank you - thought my idea was too good to be true!
L

ACG

Just to note, most mortgage lenders allow a 10% overpayment.

So if you have a £100k balance, you can overpay by 10% (£10k) and its only the remaining £90k that would incur the ERC. So the ERC would be £900 not £1000 (assuming a 1% ERC). I think they also charge an £80 deeds release admin fee.

Double check with Barclays though, they may allow you to port the mortgage to a new property and avoid the ERC.

Laura1980

Thanks for that! Will do my sums some more

amnblog

Barclays will refund you the ERC if you take another mortgage with them within 6 months. (subject to rules and criteria)

bowsh9

Any idea if a 5 year fix taken out in 2014 would be eligible for an erc refund if i took out another mortgage with barclays within 6 months? Could save me a small fortune.

amnblog

My contact at Barclays tells me they will refund if the new completion is within 30 days - if the new completion is delayed due to unforeseen circumstances they can refund up to 180 days later if you are borrowing 75% or more - each case is considered individually.


Speak to them about your case.