Nationwide overpayment reserve.

Essexsi

Good afternoon..

Thanks to this site I have been overpaying my Nationwide mortgage and have built up a significant amount of money that shows separately in an Overpayment reserve. This reserve can be accessed at any time and the amount withdrawn adds to the amount owed.

Luckily I am 5/6 months from clearing the mortgage. However, I would like to keep the Overpayment reserve available in case of emergency or future house move.

What is the best way to achieve this? My mortgage payment is about 500 and I overpay by the same.
Thanks for any help or advice. Si

getmore4less

How long is your full term?

Essexsi

Hi. My original repayment date is 2031. Si

getmore4less

Ask them to recalculate to pay off over the remaining full term.

Essexsi

Firstly thanks for taking the time to reply.

Current mortgage amount left is 4/5 k. So if I understand you correctly get NW to recalculate so this amount is paid off over the 12 years left. Redirect my overpayments elsewhere.

Is this a common thing that mortgage companies get asked? Do is quite an easy conversation to have.

Thanks again for your help. Si

greenbee

You can change this on Nationwide's website in the 'overpayments' section, although I think this is just for future payments, so to use the existing reserve you'll have to talk to a human. But it's a perfectly normal thing to want to do. Just take a long time to pay off that last £5k

Essexsi

greenbee wrote: »

You can change this on Nationwide's website in the 'overpayments' section, although I think this is just for future payments, so to use the existing reserve you'll have to talk to a human. But it's a perfectly normal thing to want to do. Just take a long time to pay off that last £5k

Thanks. I just want everything to stay the same ie access to OP reserve and mortgage term length for flexibility. Yes 5k over 12 years but things may change before then.
I may have a change in personal circumstances soon so I think this may give me the flexibility i require.
Thanks for replying . Si

Essexsi

Sorry green bee, just re-read your post. I don't want to pay mortgage each month from O P reserve, I want to maintain that so I have access to it if required. I will make mortgage payment as normal. Cheers Si

getmore4less

For a future house move that would require full affordability checks.

Also research if anyone has ever been refused a drawdown on the reservre

Essexsi

getmore4less wrote: »

For a future house move that would require full affordability checks.

Also research if anyone has ever been refused a drawdown on the reservre

Fortunately I have never had to access the reserve. According to my original paperwork in 2002, the money would be deposited in my bank account within 7 working days. I had just assumed (I know!) that accessing it would pose no problems. It's my money!!!!!

Thanks. Si

phillw

Essexsi wrote: »

I had just assumed (I know!) that accessing it would pose no problems. It's my money!!!!!

No it's not. It's money you repaid to nationwide faster than you had originally agreed. They have the right to refuse to lend it back to you if they believe you will not be in a position to repay it again. It sits somewhere between a normal mortgage and an offset mortgage, AFAIK nationwide no longer offer it on new mortgages.

I was in a similar position and decided that for various reasons it was better to just clear the mortgage. The mortgage had been competitive but it was easily beatable at the end, so even if I were to ask for it back then it wouldn't be worth it.

Essexsi wrote: »

Luckily I am 5/6 months from clearing the mortgage. However, I would like to keep the Overpayment reserve available in case of emergency or future house move.

What is the best way to achieve this? My mortgage payment is about 500 and I overpay by the same.

It's a bit late now, but for this situation you should have set the mortgage to reduce the repayment when making an overpayment. The advice on MSE is to have it recalculate the term as you pay less in interest.

I believe nationwide make a charge for extending the term, so if you do decide to go ahead then bear that in mind as well as any interest they will charge you. I also believe you can ask some lenders to leave £1 on the mortgage to keep it open. This was a trick that people used to avoid having to looking after the deeds themselves, when the lenders kept deeds. I don't know if nationwide do, I didn't get that far.