Once you pay off your full mortgage amount, what happens next?

the_mandarin

I may be jumping the gun a bit here considering it will perhaps still be a few years before I need this information, but I was still wondering what happens once you pay off your full mortgage amount to your Bank.

Is there any need to hire a lawyer again at that point, to fully transfer the house to your name from the Bank? If so, then are these fees high enough to be factored in before actually paying off your full mortgage amount?

chanz4

Bank normally can do the removal, or even do it yourself

the_mandarin

chanz4 said:

Bank normally can do the removal, or even do it yourself

Thanks for your reply, but can you please elaborate on what you mean by "removal"?

CSI_Yorkshire

The house is already in your name.  The house is not in the bank's name in any part.

What the bank has is a "charge" on the title - that sort of says you can't sell without us saying so, we can get the money from the sale to pay back the debt etc...

When you pay off the mortgage completely, this charge is removed from the title.

the_mandarin

CSI_Yorkshire said:

The house is already in your name.  The house is not in the bank's name in any part.

What the bank has is a "charge" on the title - that sort of says you can't sell without us saying so, we can get the money from the sale to pay back the debt etc...

When you pay off the mortgage completely, this charge is removed from the title.

Thanks, that was very helpful

Does the Bank remove the charge on its own once the Mortgage balance reaches zero, or do I have to contact them to get this done? Also, how do I know that this "charge" has been removed?

Nearlyold

Typically the Lender will write to you a month or so before your Mortgage is due to be paid off with details of any account closing fees payable in addition to the mortgage debt itself.  Typically the same letter also asks if you want to use your own solicitor to deal with discharging the lenders interest in the property or whether you want the lender to deal with it.

the_mandarin

Nearlyold said:

Typically the same letter also asks if you want to use your own solicitor to deal with discharging the lenders interest in the property or whether you want the lender to deal with it.

Thanks
What is the recommended way to go please - Use our own solicitor, or leave it to the Bank?
And if left to the Bank, do we have to pay their solicitor's fees?

Makingabobor2

This is an interesting thread that I will watch with interest. I'm obviously a bit naive, as this never occurred to me. Ours is due to end in 3 years, but we are now making OPs to get it paid off quicker. I just assumed once it was paid, that was that. So do the Mortgage company charge you to "discharge" their interest then? 

CSI_Yorkshire

The mortgage company charge you for all sorts of things, like discharging their interest or closing the account.  There are sometimes extra charges for paying off the loan earlier than previously agreed.

Example from YBS:



The "Mortgage exit fee" is one thing - but note the line that says "you may be charged a separate fee by your conveyancer".

marcia_

 Nationwide just removed the charge when we made our final payment. Didn't need to contact them to do so 

Makingabobor2

marcia_ said:

 Nationwide just removed the charge when we made our final payment. Didn't need to contact them to do so 

That's good to hear. We are with L!*ds, so maybe I'll contact them and ask how it works, They never mentioned it when I spoke to them about overpayments recently