How much balance to leave??

Globemaster

So I'm opting to clear my mortgage (bar a tiny bit) in July after my fixed rate ends. My HSBC mortgage adviser agreed it's a good idea to keep the mortgage running when it auto switches to a SVR rate of 6.99% until its end date of April 2034. 
But how much to leave in? Will £100 be ok. Just don't want it to end itself early. 
Many thanks

Hoenir

What's the purpose of leaving a balance? 

Globemaster

Well, credit rating, I believe in a dire emergency, you can get back what you overpaid and restart the mortgage again and I think, if you're away from the house and someone moves in and there's still a mortgage on there, they get involved. 
Yes I know some will poo poo every reason and say clear it, but nobody can see into the future. Keep ALL your options open. It can't do you any harm.

Hoenir

Unless the mortgage product has a facility built in. Then there's no ability to simply withdraw overpayments. Be a new application. Subject to the lenders own criteria at the time. Not least the purpose that the funds will be used for that are released by the remortgage.

Globemaster

It's what the HSBC mortgage adviser told me at the face to face meeting. 

tizerbelle

You can register with Land Registry to get alerts for activity on the register such as someone trying to change the property details or lodge a mortgage.  https://www.gov.uk/guidance/property-alert

Globemaster

tizerbelle said:

You can register with Land Registry to get alerts for activity on the register such as someone trying to change the property details or lodge a mortgage.  https://www.gov.uk/guidance/property-alert

Yes, I've just found something on the Citizens Advice bureau.

Here's a story that I hope no one gets themselves into 
https://www.walesonline.co.uk/news/wales-news/house-theft-stolen-land-registry-16452180

saajan_12

Globemaster said:

Well, credit rating, I believe in a dire emergency, you can get back what you overpaid and restart the mortgage again and I think, if you're away from the house and someone moves in and there's still a mortgage on there, they get involved. 
Yes I know some will poo poo every reason and say clear it, but nobody can see into the future. Keep ALL your options open. It can't do you any harm.

Re-Drawdown - this isn't a common facility, and rather than leave it to chance you can just read your current mortgage agreement to check. Ask the mortgage advisor what the wording of a standard clause would be.
Logically if you had poor credit in future but hadn't been paying them much interest over the years due to minimal balance why would they want to let you borrow? 

Squatters - the lender doesn't have any further rights than you do. Squatting in a residential property is illegal and you would call the police. If you had let to someone who refused to leave then thats a court process, but this mortgage wouldn't allow that anyway, youd have to change to a BTL. 

Yes I'm poo poo-ing those reasons, but there is a harm from keeping it open - 
Upon sale or remortgage, it's an additional thing to think about and hurdle in the conveyancing which could be an extra fee or worst case could be a failed sale if say the bank delay in processing the redemption in order to clear the charge . 

Hoenir

Globemaster said:

It's what the HSBC mortgage adviser told me at the face to face meeting. 

Well there's no harm in leaving a balance. I wouldn't expect a customer facing bank mortgage operative to get into conversations about squatters though. Perhaps they simply took the easiest option of providing you with an answer with the reassurance you were seeking. Rather than providing anything which could be construed as specific advice. 

South_coast

I can't think of a dire emergency which would require mortgage-sized borrowing? I paid off my mortgage nearly 3 years ago, no impact on my credit rating. You can save up an emergency fund and take out a 0% credit card, that will see you through almost anything