Mortgage Overpayment charges

Thrugelmir

KnowledgeIsLife wrote: »

I don't see how quoting nationwide information is relevant .

As an illustration. The MMR is a regulatory framework. That lenders have to adhere to. There's no question of them choosing which parts they impose and those that they don't. Affordability checks on term amendment are a by product that lenders do to protect themselves.

KnowledgeIsLife

MMR is not applicable if your lender allows you to reduce your term as part of a capital repayment as it does not effect effect affordability I know this as I do this every single day and this is what he wanted to do i answered his question based on the information he said he wanted to do and when I seen he couldn't as his lender does not give this option I give him an alternative rather then doing an application to reduce term as this would just increase his payments ..

loonywitch

Is it essential to reduce the term? We overpay monthly on our mortgage and if we were to continue to overpay at the rate we do, we would reduce our balance to zero within 7 years opposed to the 23 years that's left...all we would have to do is pay £50 early repayment charge.

KnowledgeIsLife

Depends on the individuals circumstances as to what they want if it's just a lump sum and you don't want to reduce payments a term reduction might be best for you if your lender allows this process as clearly not all do or you can reduce your payments but still pay over the same length of time better for people wanting to reduce outgoings instead

hawkinm

I think I must have confused the Natwest agent. I went back to Natwest again and followed BakingC's advice. I asked to make a capital repayment and keep my monthly payments the same. Turns out that their computer system is set up to automatically reduce the monthly payments and someone has to manually intervene to set up a second payment. The two payments total the original monthly payment. I will check my next payment to confirm everything is ok.