Stopping overpayments

Sncjw

Hi all 

So I've just set up to do overpayments and the first one will be taken in march. Our mortgage is 396 a month and we will be overpayinf by 620 a month so making total of 1016 a month..

Now when I set it up if said I could only over pay by 325 on the until further notice option but I could set up the 1016 for a set date which I picked for 2 years time which will be a month before our mortgage deal ends and needs to get a new rate. 

So if things crop up in the mean time as I am trying to lose weight so we can try for a baby as I have pcos so may make it difficult o have one. Anyways if we were to have a baby and needed funds for that would we be able to stop the overpayments despite saying pay till a set date? 

We will also be using extra savings to pay off credit cards which 0 percent deal doesn't and for a couple years so we will pay that off before the new mortgage deal and also start to put that aside when the credit card is paid off. I'm not stressing over the credit card as I know it can be managed. 

We were paying the mortgage overpayment and savings to another credit card which is paid off this month so i rather use the 600 to the mortgage. 

Anyways so would we be able to stop the overpayments if needed.

J have posted this on the mortgage free wannabe board with no success.

jrawle

Who is the lender and what type of product is it? Each bank has a different way of doing it, so let us know and someone will be happy to help you.

Sncjw

Nationwide and repayment mortgage 

jrawle

I am with Nationwide, have been for many years, and just make overpayments each month by faster payments, from the internet banking of my current account provider (which is a different bank). There's no need to sign up to make regular payments, and I don't think there is such a facility with a Nationwide mortgage. I guess what you have signed up for is a standing order from your current account, which you can cancel or amend at any time.

My suggestion would be to cancel the standing order, then just make a manual payment of the amount you can afford to pay each month. Then you can vary the amount. If you need to overpay less in one month because you had other unexpected expenses, or need to stop altogether, you are in control. Of course, you do need to be disciplined and actually make the overpayments, not see the money in your current account as extra spending.

Sncjw

jrawle said:

I am with Nationwide, have been for many years, and just make overpayments each month by faster payments, from the internet banking of my current account provider (which is a different bank). There's no need to sign up to make regular payments, and I don't think there is such a facility with a Nationwide mortgage. I guess what you have signed up for is a standing order from your current account, which you can cancel or amend at any time.

My suggestion would be to cancel the standing order, then just make a manual payment of the amount you can afford to pay each month. Then you can vary the amount. If you need to overpay less in one month because you had other unexpected expenses, or need to stop altogether, you are in control. Of course, you do need to be disciplined and actually make the overpayments, not see the money in your current account as extra spending.

You can set up regular overpayments via the online banking page and I have confirmation. I've set it up via that. 

It gave option of until a set date or until further notice but further notice would only give me half the amount I want to over pay but to a set date gives me the option of putting what I want in. I have kept it within the limits of 10 percent of the total mortgage we taken out 

jrawle

OK, I see there is something called the "Mortage Manager" you can log into and create regular overpayments. I have never done this. I stand by my original comments. Cancel the regular overpayment and use faster payments to make an extra payment each month (what they call a "one-off overpayment").
https://www.nationwide.co.uk/mortgages/existing-mortgage-members/overpayments/

You can do this on the same day your mortgage direct debit is taken, usually the first of the month. You are then free to pay however much you want each month.

Sncjw

Yeah but I know I have the money to pay it. It wasn't the question of payingbit a different way it was more can I stop the regular payments if I need to. I'd rather it be taken automatically than me having to remember each month to do it 

gih

Sncjw said:

Yeah but I know I have the money to pay it. It wasn't the question of payingbit a different way it was more can I stop the regular payments if I need to. I'd rather it be taken automatically than me having to remember each month to do it 

Do you also have a Nationwide current account (FlexAccount)?  What we do is, from our FlexAccount, set up a regular payment to the mortgage account (to come out same day each month as the normal mortgage payment). No need to remember to make the overpayment each month and it's easily changed / stopped if needed.  Compared to the mortgage manager route, you lose the flexibility of choosing the effect of the overpayments (reducing term, reducing future payments, etc.), but we don't really mind as we don't want to reduce term or future payments anyway.

I don't know for sure about stopping regular overpayments through the mortgage manager, but I'd be very surprised if there'd be any problem doing that. I'd imagine the "set date" is just for your convenience, rather than tying you down in any way.

Edi81

You can stop overpayments at any time. 

As long as you make your contractual repayment each month. 

Sncjw

gih said:

Sncjw said:

Yeah but I know I have the money to pay it. It wasn't the question of payingbit a different way it was more can I stop the regular payments if I need to. I'd rather it be taken automatically than me having to remember each month to do it 

Do you also have a Nationwide current account (FlexAccount)?  What we do is, from our FlexAccount, set up a regular payment to the mortgage account (to come out same day each month as the normal mortgage payment). No need to remember to make the overpayment each month and it's easily changed / stopped if needed.  Compared to the mortgage manager route, you lose the flexibility of choosing the effect of the overpayments (reducing term, reducing future payments, etc.), but we don't really mind as we don't want to reduce term or future payments anyway.

I don't know for sure about stopping regular overpayments through the mortgage manager, but I'd be very surprised if there'd be any problem doing that. I'd imagine the "set date" is just for your convenience, rather than tying you down in any way.

Yeah I wanted to reduce the term rather than the default reduce the monthly payment option..

Edi81 said:

You can stop overpayments at any time. 

As long as you make your contractual repayment each month. 

Thank you. I don't see an issue but wanted to know just in case anythin crops up but we will be saving extra money anyways..

ManekiNeko

As you'll be making quite large overpayments, just check with your lender first that you'll be within your repayment limit for the year. For most mortgages, that's 10 per cent of the outstanding balance (not the original amount borrowed, unless you're in your first year).

There can be big financial penalties for getting this wrong, so it's worth checking.

Also, do consider your mortgage rate vs. the best savings rate you can get - e.g. if you're still on a 2 per cent fixed rate, but you can get 5 per cent on your savings, you should probably sock the money away in savings instead, and just do one overpayment a year to maximise your interest. Ofc, this only applies if you've the financial discipline not to touch it.

Also also - do make sure you've got a tidy emergency fund saved up first, ideally, or at least that you'll be starting one alongside your OPs.

Best of luck.