Halifax Overpayments

christhesparky_2

Morning
For the last 6 months or so I have been making small overpayments on my Halifax mortgage via online banking.
Do I need to contact Halifax to specify that I would like the overpayments to reduce the term of the mortgage? Since beginning making the overpayments they add upto over 1 months repayment, or 2 months worth of interest, yet the remaining term stated online has not reduced.

Thanks

Ellie78

Hi Chris
We've been making regular overpayments on our Halifax mortgage for almost a year now and it was reducing the length of the term but not "officially" i.e. it didn't show up as shortened on the online statement but when I called them the payments had reduced the capital owed and remaining number of payments.  
HOWEVER when our annual statement came through a few weeks ago they'd recalculated what we owed across the original length of the term, so our monthly payment amount has gone down but we've regained the years we'd knocked off.   I suspect a phone call would be straightforward enough to renegotiate the term length.  

christhesparky_2

Thanks Ellie78, I was going to ring them but didn't want to prevent people affected by covid getting through.
Ideally I want to reduce the term not the monthly payment.

A_Frayed_Knot

I also overpaid, and they didn't reduce the term (they also reduced my payments over the original term time, just like Ellie78, Cheeky blighters !!!) until it was time to either go into a new deal or revert to the SVR, which is when I negotiated a reduced term time.  I also took the opportunity to up my payments to what I could comfortably afford, as I still had the 10% overpayment option there, which I took full advantage of, but had the option of not using should anything have arisen out of the blue.

Depending at what stage you are at for your mortgage, I wouldn't worry too much, you could either top up to the original payment, if they reduce your payment, but if you are near the end of your mortgage or can afford to overpay more than 10% - that's when you need to negotiate a reduced term time to up your payments, or you would run out of your 10% overpayment allowance very quickly.

Hope all that makes sense to you and Good Luck - Don;t pay a penny more in interest than you have too.

SpoonKat

You will need to contact them and say apply any over payments to the capital amount and reduce the term , that way your regular payments stay the same.

aznlayer

I had a mortgage with Halifax which I paid off last year. I always made overpayments and this never effected my monthly amount. In fact, they never charged me with an overpayment penalty either, even though I often went over the 10% limit. I was expecting to be landed with a big bill at the end, but they never did. I am guessing that it was just a glitch and that I was luck. 

sofarbehind

Interesting aznlayer - I have been overpaying my Halifax mortgage and they haven't changed the monthly amount or the term on the paperwork they send me. I keep expecting them to drop the monthly payments as they sent me a letter saying it would be recalculated last year....I wonder if corona chaos has slowed them down. I'm hoping it doesn't happen...

KP74

I currently have a Halifax mortgage.  I have been making OPs for the past couple of years.  The overall figure is getting lower but the term has stayed the same.  I normally ring them to ask what them how much of my 10% OP is left and they are happy to tell me.