Mortgage Overpayment Question

jumperabv3

I have successfully completed today my remortgage, the amount is £250k. Now I have a question about repayments - according to the mortgage offer it says the following:

It says I can make overpayments up to 10% of £250,000 - does it mean I can pay up to £25,000 in addition per year without paying any penalty for it?
My mortgage broker told me it's best to wait the 1st year before making overpayments because there are no Early payments but when you finish off the mortgage then you would pay a fee for paying it quicker, however I see no clause in the offer and in my documents in regards to that except for the screenshot which I've posted here. (Maybe she's used to it from other customers?)

According to clause 11 - can I assume I can pay up to £25,000 every year (slightly would go down as the balance would go down each year) - and can I assume this doesn't have to be paid only once a year but rather I could choose to pay £1000 today, £3000 next month, since they mention "overpayments" in plural? I might call them to ask but just wanted to ask here first, perhaps some others would have more feedback?
Thanks!

soupy600

i'm waiting to get my mortgage approved and have lengthen the term due to the current climate and plan to over pay once everything is settled. Mine is similar with over paying the 10% but i took that on what you owe. So thinking if you where in a 5 year fixed your could pay up to £25,000 over those 5 years, where its a lump sum or spread over the 5 years.

Thrugelmir

jumperabv3 said:

I have successfully completed today my remortgage, the amount is £250k. Now I have a question about repayments - according to the mortgage offer it says the following:

It says I can make overpayments up to 10% of £250,000 - does it mean I can pay up to £25,000 in addition per year without paying any penalty for it?
My mortgage broker told me it's best to wait the 1st year before making overpayments because there are no Early payments but when you finish off the mortgage then you would pay a fee for paying it quicker, however I see no clause in the offer and in my documents in regards to that except for the screenshot which I've posted here. (Maybe she's used to it from other customers?)

According to clause 11 - can I assume I can pay up to £25,000 every year (slightly would go down as the balance would go down each year) - and can I assume this doesn't have to be paid only once a year but rather I could choose to pay £1000 today, £3000 next month, since they mention "overpayments" in plural? I might call them to ask but just wanted to ask here first, perhaps some others would have more feedback?
Thanks!

Concur with your thinking. 
Unsure what your broker is saying. I'd start overpaying ASAP. Maximise the benefit. 

Sensory

It's usually 10% of the outstanding loan amount, calculated once per 12-month period, and in that period you can overpay -- via multiple transactions -- by up to that amount without charges.

Petriix

My Nationwide mortgage allows 10% of the original loan in addition to the regular payments. Your mortgage broker sounds like they have no idea what they are talking about. You can overpay from day one and, the earlier you do, the more interest you will save.

jumperabv3

Thanks, I haven't received my mortgage pack yet, is there any way to find the Bank Account Number and Sort Code and Reference to use in terms of where to make payments for the mortgage?! Or shall I just call the lender and ask for this information? (but I think they aren't working before Monday and with the current global Coronavirus crisis I'm worried they might not respond at all? or perhaps I'm too paranoid?)

Thrugelmir

Did you complete a direct debit form when you applied for the mortgage? Check your online banking as the Direct Debit may well be listed now if that's the case. 
You'll be receiving a letter shortly notifying you of the monies that will taken from bank account. 

jumperabv3

Thrugelmir said:

Did you complete a direct debit form when you applied for the mortgage? Check your online banking as the Direct Debit may well be listed now if that's the case. 
You'll be receiving a letter shortly notifying you of the monies that will taken from bank account. 

I didn't, I only provided my bank details on the application for the direct debit payments - I will log on later online to see if it's showing there, worse case if not I will just give the bank a call tomorrow and ask for these details, hoping businesses still work these days. Thanks.

jumperabv3

Quite a nightmare, on the phone for over 50 minutes now, just want to ask these simple questions, but looks like the lines are extremely busy, I can only imagine why.

jumperabv3

Over 2 hours over the phone, I think I will just give up, it's abnormal to wait for so long over the phone.

soupy600

Unless your mortgage payment is due soon and you want to take a mortgage break i would leave it and wait until it calms down a bit. If its about the over payment could you maybe ring your adviser that set it up for you?