Redemption of mortgage -practicalities

firsttimebuyer2017

Hi 

Apologies if l am making this sound complicated. 

I contacted the Nationwide to obtain a redemption statement for a specific date (the first day of the final month of my current deal) where l will no longer incur an ERC as l intend to pay off all the remaining balance and also minimise any further interest charges. I want to pay it off via cheque so need to know the exact figure (Inc admin fees) and ensure it is with them in good time for that date so everything is tied off. 

I've called twice now and each time they have issued a statement based on whatever today's date is - not my requested date. The redemption statement still includes the ERC and today didn't take into account my previous monthly payment. It seems they cannot issue a redemption figure based on a future date so l can work off that number and send the cheque in anticipation.

I want to avoid a bank transfer to settle the mortgage. Am l supposed to make the calculations myself and just send the cheque stating my redemption date? 

Thanks in advance for any advice. 

Hoenir

The NW aren't going to perform the calculation for you. Remember also that a cheque will take 1 working day to be considered cleared funds. 

If you overpay the amount due the excess will soon be returned to you. 

ACG

They cant give you what you want (or at least none of the lenders I have worked for would have been able to). 
They can give you a figure as it stands at today, they can also tell you that you will incur £x amount a day in interest. But that will also incur the ERC. 

Also your mortgage usually finishes on the last day of the month. So if your mortgage finishes on the 31st January, you cant pay it off until the 1st of February otherwise you will incur the ERC. 

Is there a reason you cant just do a bank transfer? It would make life so much easier than trying to time when they get a cheque in the hope it does not get cashed early or a few days after your deal finishes. 

firsttimebuyer2017

ACG said:

They cant give you what you want (or at least none of the lenders I have worked for would have been able to). 
They can give you a figure as it stands at today, they can also tell you that you will incur £x amount a day in interest. But that will also incur the ERC. 

Also your mortgage usually finishes on the last day of the month. So if your mortgage finishes on the 31st January, you cant pay it off until the 1st of February otherwise you will incur the ERC. 

Is there a reason you cant just do a bank transfer? It would make life so much easier than trying to time when they get a cheque in the hope it does not get cashed early or a few days after your deal finishes. 

Hi, thanks for the reply. I got told there was no ERC in the final month of the mortgage deal 

Seems it won't be possible to get this figure from your experience, which is strange given they accept cheques as a payment method so that would necessitate knowing a figure in advance. 

I'll have to make payment via bank transfer which l'd hoped to avoid. 

Appreciate your response. 

firsttimebuyer2017

Hoenir said:

The NW aren't going to perform the calculation for you. Remember also that a cheque will take 1 working day to be considered cleared funds. 

If you overpay the amount due the excess will soon be returned to you. 

Appreciate the response on this. I recall they said that any excess will be returned back to me. Looks like the best option is via bank transfer 

ACG

firsttimebuyer2017 said:

ACG said:

They cant give you what you want (or at least none of the lenders I have worked for would have been able to). 
They can give you a figure as it stands at today, they can also tell you that you will incur £x amount a day in interest. But that will also incur the ERC. 

Also your mortgage usually finishes on the last day of the month. So if your mortgage finishes on the 31st January, you cant pay it off until the 1st of February otherwise you will incur the ERC. 

Is there a reason you cant just do a bank transfer? It would make life so much easier than trying to time when they get a cheque in the hope it does not get cashed early or a few days after your deal finishes. 

Hi, thanks for the reply. I got told there was no ERC in the final month of the mortgage deal 

Seems it won't be possible to get this figure from your experience, which is strange given they accept cheques as a payment method so that would necessitate knowing a figure in advance. 

I'll have to make payment via bank transfer which l'd hoped to avoid. 

Appreciate your response. 

I would double check this as section 8 on your mortgage offer will have a table that shows something like this:
 01/10/2023 - 31/10/2024 - 1% of the amount repaid - £1,234

If there is a problem, they will revert to their paperwork and the T&Cs. 

I think legally everyone still has to accept cheques (I could be wrong), but it is difficult to be so precise with one. Whenever I get cheques they sit in a draw for a few months. Im sure nationwide are a bit better with them than I am though. 

MWT

firsttimebuyer2017 said:

...and ensure it is with them in good time for that date so everything is tied off. 

Whichever payment method you use be very careful with any attempt to get the payment in their hands 'in good time' as the payment will be applied as soon as they get it, they will not wait for the ERC period to expire and apply it then.

This is why electronic transfer is better and more certain as you can initiate it the day after your ERC period expires.

user1977

ACG said:

firsttimebuyer2017 said:

ACG said:

They cant give you what you want (or at least none of the lenders I have worked for would have been able to). 
They can give you a figure as it stands at today, they can also tell you that you will incur £x amount a day in interest. But that will also incur the ERC. 

Also your mortgage usually finishes on the last day of the month. So if your mortgage finishes on the 31st January, you cant pay it off until the 1st of February otherwise you will incur the ERC. 

Is there a reason you cant just do a bank transfer? It would make life so much easier than trying to time when they get a cheque in the hope it does not get cashed early or a few days after your deal finishes. 

Hi, thanks for the reply. I got told there was no ERC in the final month of the mortgage deal 

Seems it won't be possible to get this figure from your experience, which is strange given they accept cheques as a payment method so that would necessitate knowing a figure in advance. 

I'll have to make payment via bank transfer which l'd hoped to avoid. 

Appreciate your response. 

I think legally everyone still has to accept cheques (I could be wrong)

You are. Nobody has to accept cheques.

Nobody has to accept anything really (apart from the immensely narrow circumstances where legal tender means something - but you'd have even more trouble trying to redeem your mortgage with a carrier bag full of used tenners...)

jrawle

Nationwide will be able to give you a redemption figure for a specific date in the next three months if you phone the dedicated number (0345 609 25 31)

The details are on this page:

https://www.nationwide.co.uk/mortgages/existing-mortgage-members/redemptions/

I did this in November, asking for a date a week or so in the future. In my case, there was no ERC anyway, but the lady on the phone confirmed this. Did you phone the number above, or just a general internet banking number? The latter may not have all the information. Or did you try to request it for more than three months away?

Note that I did not actually receive a "statement" as in a paper document (or even e-mail); the lady told me the figure over the phone.

I do agree with other posters about transferring the money electronically, though. If you are concerned about the money going astray, set up the online payment now, and test it by making a small payment (£1 or whatever) which you should be able to do without paying an ERC, assuming you haven't already made overpayments. That way you can be sure you haven't mistyped any numbers. You can check your mortgage account a couple of days later to see that the £1 has been credited. When you phone the redemption hotline, they will also be able to confirm that you have made the overpayment by bank transfer, as they do have this information.

Hope that helps.

firsttimebuyer2017

jrawle said:

Nationwide will be able to give you a redemption figure for a specific date in the next three months if you phone the dedicated number (0345 609 25 31)

The details are on this page:

https://www.nationwide.co.uk/mortgages/existing-mortgage-members/redemptions/

I did this in November, asking for a date a week or so in the future. In my case, there was no ERC anyway, but the lady on the phone confirmed this. Did you phone the number above, or just a general internet banking number? The latter may not have all the information. Or did you try to request it for more than three months away?

Note that I did not actually receive a "statement" as in a paper document (or even e-mail); the lady told me the figure over the phone.

I do agree with other posters about transferring the money electronically, though. If you are concerned about the money going astray, set up the online payment now, and test it by making a small payment (£1 or whatever) which you should be able to do without paying an ERC, assuming you haven't already made overpayments. That way you can be sure you haven't mistyped any numbers. You can check your mortgage account a couple of days later to see that the £1 has been credited. When you phone the redemption hotline, they will also be able to confirm that you have made the overpayment by bank transfer, as they do have this information.

Hope that helps.

Hi, l did call the dedicated number for mortgage redemption information as opposed to the general account enquiry line. They twice said they couldn't provide a statement for the balance on my preferred redemption date but only for the day l called. Quite frustrating really. 

I've set up a test payment for £10 and am checking for that coming through. Also contacted First Direct to alert them that a large payment will be going through and that l have enough headroom (max payment is £50k).  

Ready to go now 

Thanks all for the help.