Remortgaging, Old Lender has requested Direct Debit

iKarlCPFC

Hi, just looking for some advice.

Backstory.

My SO is on maternity leave and the NHS forgot to tick the maternity pay option so we're already low on funds this month.

New mortgage deal with new lender kicks off on 1st Sept.

Just been told current lender has requested funds via Direct Debit on the non fixed term as that ends on 1st Sept. Which is 60% more than what we're paying now.

The current lender said they can't stop the payment as it's already processing, the lady said the best thing to do is do a Direct Debit Indemnity as my bank would have to pay back the money immediately. 

My question is, is that safe? We're low on funds until the rest of our money comes in whenever that will be, I don't want to cause an issue with my credit score but at the same time what the bloody hell do I do?

Obviously the safest option is let them take the money and wait for the "official" refund but we're talking £550ish which is a significant sum.

Brie

Credit scores are unimportant as no one looks at them.  Credit histories are important but you bank can already see more then they reveal as they can see what you are doing with your accounts/mortgage etc.  The only time there might be an issue is if you are applying for new credit somewhere else now or in the next couple of months.  You're already sorted with the new lender so there shouldn't be a problem

DD indemnity are pretty quick so should be fine. 

Your alternative might be to ask you bank where your account is to advance you the money for a set period.  Some banks will, in extreme circumstances, allow you to overdraw by a set amount (say £500?) even if you don't have an overdraft.  This is because you are notifying them in advance about something that has gone wrong and is affecting your finances that is beyond your control.

Other alternative is to stay on the phone with NHS payroll until they guarantee that there will be an advance payment made immediately due to their error. 

kingstreet

What is the date of assumed final payment on your redemption statement? Ask your solicitor.

iKarlCPFC

The final date is assumed 31st August. 

I just don’t know if I should cancel the direct debit or not. 

Don’t fancy having a late payment on my record even though they won’t be my provider anymore. 

pramsay13

Just cancel the direct debit. 

dunstonh

The current lender said they can't stop the payment as it's already processing, the lady said the best thing to do is do a Direct Debit Indemnity as my bank would have to pay back the money immediately. 

DD requests for regular payments are often submitted as early as 3 weeks before.   However, you dont need to do an indemnity claim as it hasnt gone through yet.  Just cancel the mandate.

Indemnity claims are for payments that have gone through already.  Not for payments that have not yet gone through.  Just cancelling the direct debit will mean the bank will return it unpaid that day.