Mortgage Offer £3k more than we owe. Accept and overpay?

hufc2002

Hi

I'll make this a short and straightforward as possible.

Current HSBC Fix ends 30/09/2022.  Received an offer from Virgin at end of March for what we owed at the time (offer expires 28/09/22).  

We are now wanting to arrange a completion date however the offer we received is now over £3k more than we currently owe as we have obviously made further payments.  So my question is, do we agree a completion date based on the offer and then immediately pay the difference off the mortgage?  What are the pros and cons of doing this?  Or do I ask my broker to go back to Virgin to ask for a reduced offer?

Thanks

penners324

You agree a completion to coincide with the end of the first mortgage. The conveyancer then gets a completion statement and gets the new mortgage firm to pay the old one

penners324

You accept the offer and the conveyancing firm sorts out the correct value at the relevant time

K_S

hufc2002 said:

Hi

I'll make this a short and straightforward as possible.

Current HSBC Fix ends 30/09/2022.  Received an offer from Virgin at end of March for what we owed at the time (offer expires 28/09/22).  

We are now wanting to arrange a completion date however the offer we received is now over £3k more than we currently owe as we have obviously made further payments.  So my question is, do we agree a completion date based on the offer and then immediately pay the difference off the mortgage?  What are the pros and cons of doing this?  Or do I ask my broker to go back to Virgin to ask for a reduced offer?

Thanks

@hufc2022 As an applicant, in your place I would just overpay any surplus amount into the mortgage once the conveyancer paid it into my account after completion. As a broker, I'd hope the client would do the same and spare me the hassle of adjusting the offer downwards for a relatively minor amount

The main cons that I can think of are that you may end up paying 1-2 days interest on the £3,000 extra borrowing, and the £3,000 overpayment will use up part of the 10% annual overpayment allowance for your new Virgin mortgage.

The main pro is that you can leave things undisturbed.

I don't know about Virgin, but some lenders will not allow a surplus of more than x for a like-for-like remo, in which case usually the solicitor will do the necessary adjustment required.