Selling House: How to Avoid £6k Mortgage early repayment fee?

Howikay

hey all

I've just sold my house. I have 2 months left of the fixed-term mortgage term (ends 2nd Feb 2023). the buyers need to close the sale on the 16th Dec

My bank (Santander) have in their terms that early repayments incur a £6,000 charge (3% of the remaining balance of the mortgage). I'll be repaying it 6.5 weeks early. My monthly mortgage payment is interest only at £250pcm, interest rate 1.29%

Is there any way I can avoid this charge? it seems crazy that just a few weeks from the term end they can charge me such a large fee 

I've spoken to Santandar but they said I have to pay it

Any way to avoid?

Any help or advice greatly appreciated

Orchid12

I was literally just coming to do a post on the same thing! But remortgaging, my new offer expires 2 days before I wouldn’t have to pay 7.5k ERC. Wondering if there’s anyway I can avoid. Also with Santander 

housebuyer143

Howikay said:

hey all

I've just sold my house. I have 2 months left of the fixed-term mortgage term (ends 2nd Feb 2023). the buyers need to close the sale on the 16th Dec

My bank (Santander) have in their terms that early repayments incur a £6,000 charge (3% of the remaining balance of the mortgage). I'll be repaying it 6.5 weeks early. My monthly mortgage payment is interest only at £250pcm, interest rate 1.29%

Is there any way I can avoid this charge? it seems crazy that just a few weeks from the term end they can charge me such a large fee 

I've spoken to Santandar but they said I have to pay it

Any way to avoid?

Any help or advice greatly appreciated

No, if you redeem early you will need to pay. If the buyer is so keen to complete in December maybe they want to pay for it? 

Did you make it clear from the outset the date you needed to complete after? If you told them from the outset then I think they should be expected to wait. If you didn't, then maybe you come to an agreement to meet in the middle? 

user1977

Howikay said:

Any way to avoid?

The way to avoid it is to complete after the relevant date. If you choose not to, then you have to pay it. You agreed to the terms when you took out the mortgage.

fewcloudy

No, you will have to pay this. The only way to avoid is to complete after 2nd February.

kingstreet

Here. Explained many times previously;-

https://forums.moneysavingexpert.com/discussion/comment/79453453#Comment_79453453

On-the-coast

Do your terms allow you to overpay up to a certain amount each year?  10% was common when I had fixed rate mortgages.  Can you at least pay that part back  before completion? Would save you a few hundred pounds…

london21

Santander don't think there is a way around it unless completing after.

london21

Orchid12 said:

I was literally just coming to do a post on the same thing! But remortgaging, my new offer expires 2 days before I wouldn’t have to pay 7.5k ERC. Wondering if there’s anyway I can avoid. Also with Santander 

surely can delay by 2 days? 

Orchid12

london21 said:

Orchid12 said:

I was literally just coming to do a post on the same thing! But remortgaging, my new offer expires 2 days before I wouldn’t have to pay 7.5k ERC. Wondering if there’s anyway I can avoid. Also with Santander 

surely can delay by 2 days? 

You would think wouldn’t you. Just called both, no budge on not paying it and no movement on the offer date. So looks like I will have to pay. 

Don’t think there will be any luck with the 6.5 weeks! I would be asking the buyers to cover it. 

silvercar

Orchid12 said:

london21 said:

Orchid12 said:

I was literally just coming to do a post on the same thing! But remortgaging, my new offer expires 2 days before I wouldn’t have to pay 7.5k ERC. Wondering if there’s anyway I can avoid. Also with Santander 

surely can delay by 2 days? 

You would think wouldn’t you. Just called both, no budge on not paying it and no movement on the offer date. So looks like I will have to pay. 

Don’t think there will be any luck with the 6.5 weeks! I would be asking the buyers to cover it. 

For the sake of 2 days, I wonder if your solicitor could take the money from the new lender and not pay it over to Santander for 2 days? Worth asking?