Halifax mortgage overpayments

webdigga

Hi,

I just made an overpayment on my Halifax mortgage for the first time.

At Nationwide it was very simply reduce the term, or reduce the monthly payment.

By default Halifax does neither.  I tried calling to ask what happens if I don't choose one of these methods and I could not really understand what they said, something about reduced interest..

At Nationwide I always chose to reduce the term, and figured that would also reduce interest as I was being charged on a smaller mortgage anyway.

So I really don't understand what happens if I pay off an amount of money, but somehow it's possible that neither the term or the payment goes down?

Any help would be greatly appreciated

David

Edi81

The interest going forward will reduce and has effectively reduced the term. 

Bigphil1474

As above, you'll just end up paying it off sooner, so by default the term has gone down. If you come to re-mortgage, you could revert to the original term and pay less if you get a similar rate.

kingstreet

See pages 30 & 31;-

www.halifax-intermediaries.co.uk/assets/pdf/info-for-mortgage-customers.pdf