Mortgage redemption fee

carbonm

I spoke to our provider yesterday about paying off the remaining £7000 off our Mortgage. As our term is over 12 months we would have to pay an early redemption fee. They did say we could make a lump sum payment off £6000 to reduce term to under 12 months then a final payment to clear the rest. I'm not great with maths so wanted to double check here if that sounds right?

edinburgher

I'm not sure what you're looking for comment on? Sounds like you're currently facing an early repayment charge if you pay it off in full and the bank have suggested a helpful way to avoid this?

inigma

How much is your Overpayment Facility, has this been maxed out?

carbonm

inigma said:

How much is your Overpayment Facility, has this been maxed out?

Unlimited overpayments, only fee is early redemption 

Petriix

carbonm said:

inigma said:

How much is your Overpayment Facility, has this been maxed out?

Unlimited overpayments, only fee is early redemption 

Often the cheapest overall method is to overpay to the extent that your monthly payment for the remaining term is ~ £1 per month. This can work out better than paying any redemption fee and effectively becomes a 'deeds storage service charge'. It obviously depends on the specifics of you particular mortgage as to whether this would work.