We'd like to remind Forumites to please avoid political debate on the Forum... Read More »
We're aware that some users are experiencing technical issues which the team are working to resolve. See the Community Noticeboard for more info. Thank you for your patience.
📨 Have you signed up to the Forum's new Email Digest yet? Get a selection of trending threads sent straight to your inbox daily, weekly or monthly!
Not planning on porting mortgage, overpay before selling house to avoid ERC?
Options
t1redmonkey
Posts: 945 Forumite
I have about 6 years left on a 10 year mortgage, but I am selling my house and planning to only use part of the proceeds to buy my next place so I won't actually need a mortgage anymore. Unfortunately I have one of those sliding scale mortgages with charges if you redeem early depending on the amount left on the mortgage. I think mine is a 4% charge currently for the remaining balance. Seems like an obvious answer, but should I just try and overpay this as much as possible before the completion date to reduce the charge I have to pay? Or is there anything obvious I am missing here that makes this not a good idea?
0
Comments
-
You aren’t missing anything. The lower the outstanding debt. The lower the ERC.1
-
It's likely your mortgage only allows 10% overpayment each year....1
-
Yes that is the case. But I was going to at least overpay the max amount within the 10% to reduce it as much as I can.penners324 said:It's likely your mortgage only allows 10% overpayment each year....0
Confirm your email address to Create Threads and Reply
Categories
- All Categories
- 351K Banking & Borrowing
- 253.1K Reduce Debt & Boost Income
- 453.6K Spending & Discounts
- 244K Work, Benefits & Business
- 599K Mortgages, Homes & Bills
- 176.9K Life & Family
- 257.4K Travel & Transport
- 1.5M Hobbies & Leisure
- 16.1K Discuss & Feedback
- 37.6K Read-Only Boards