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Mortgage switch then ditch to avoid ERC?
JamesN
Posts: 794 Forumite
Bit of a complicated scenario here so will lay out as best I can.
We are currently have a property with Help to Buy on it. We're coming to the end of our 5 years fixed mortgage term. It is with Nationwide and ends on 30th Sept 2020.
We are also in the process of selling our house to move into rented accommodation. Currently looking at a date of mid July for completion.
This morning, I've just had a letter from Nationwide that says as we are now within the last 5 months we can switch to a different deal and pay no early repayment charge, so long as the deal is still with Nationwide. On the back of the letter there are some deals, some of which are zero product fee tracker deals that also have no early repayment charge.
Having looked at the Nationwide website, it says the deal will only become active 3 months from the end of your current deal and that the deals renew on the 1st of the month so long as its submitted 5 business days before the end of the month. Thus, my deal could change on 1st July.
So for me, the plan is, switch to the new product, and then repay the mortgage when my house hopefully completes mid July. Thus paying no ERC and saving c£1,500.
Questions for me are, would there be any fee for the HTB or do you just remortgage as normal? It feels too easy, is there a clause i'm missing? I went on chat and said would it be possible to do that. The answer was "I guess so". So not 100% filled with confidence on it. I imagine the chat team aren't experts on the T's and C's.
What do you guys think?
Many thanks in advance.
We are currently have a property with Help to Buy on it. We're coming to the end of our 5 years fixed mortgage term. It is with Nationwide and ends on 30th Sept 2020.
We are also in the process of selling our house to move into rented accommodation. Currently looking at a date of mid July for completion.
This morning, I've just had a letter from Nationwide that says as we are now within the last 5 months we can switch to a different deal and pay no early repayment charge, so long as the deal is still with Nationwide. On the back of the letter there are some deals, some of which are zero product fee tracker deals that also have no early repayment charge.
Having looked at the Nationwide website, it says the deal will only become active 3 months from the end of your current deal and that the deals renew on the 1st of the month so long as its submitted 5 business days before the end of the month. Thus, my deal could change on 1st July.
So for me, the plan is, switch to the new product, and then repay the mortgage when my house hopefully completes mid July. Thus paying no ERC and saving c£1,500.
Questions for me are, would there be any fee for the HTB or do you just remortgage as normal? It feels too easy, is there a clause i'm missing? I went on chat and said would it be possible to do that. The answer was "I guess so". So not 100% filled with confidence on it. I imagine the chat team aren't experts on the T's and C's.
What do you guys think?
Many thanks in advance.
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