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Option to settle mortgage early (with discount)
Philby_Walsh
Posts: 1 Newbie
Hey folks, a few years back I took out a small mortgage to buy an investment property - which has 9 years to run to maturity.
The banking group have since sold off many billions of commercial & residential properties at a discount, as part of a move to close down the banking operations of the bank I originally took out the mortgage with.
Anyway, the new owners of the loan book have offered me a discount of ~8% to settle the mortgage early...and given ~2 weeks to provide a response.
If I move some money around I may be able to free up enough capital to clear the loan.
I haven't sat down to do the sums yet but am hoping for a bit of guidance on things to consider when making this decision.
Any guidance most welcome.
The banking group have since sold off many billions of commercial & residential properties at a discount, as part of a move to close down the banking operations of the bank I originally took out the mortgage with.
Anyway, the new owners of the loan book have offered me a discount of ~8% to settle the mortgage early...and given ~2 weeks to provide a response.
If I move some money around I may be able to free up enough capital to clear the loan.
I haven't sat down to do the sums yet but am hoping for a bit of guidance on things to consider when making this decision.
Any guidance most welcome.
0
Comments
-
Interest only, mortgage rate, long term plans ?
What rates are you getting from your savings ?
How old are you ?
Do you want to keep the property for rental income0 -
If you are of a mind to settle, make a counter offer first (e.g -20%).
They have already shown they want the cash back in and they are unlikely to have made their initial offer at their limit.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.0
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