Porting mortgage - interest on redemption

stevetuk

I am porting my mortgage like for like (exactly, no additional or less borrowing, same rates, same term etc) from my current property that I have sold, to a new property that I have purchased. All approved all fine etc.

The solicitors have sent me an exchange summary of costs, and in this is an interest payment of £1700 on the mortgage for it to be redeemed. There is also an additional £2999 early settlement fee, which the lender has said will be refunded on completion if completion is within X number of days (well within this, unless it all goes wrong).

My questions are:

1. Why am I being charged the interest up front now when the mortgage is being ported exactly as is? Should I contact the lender to ask or the solicitor?

2. How does the early repayment fee get refunded? Is it in cash or against the outstanding balance of the mortgage?

TIA.

user1977

You're redeeming the old account and starting a new one - the "porting" is just carrying over the product, but in reality you're doing the normal thing of paying off the old mortgage account and being advanced the new loan. So there'll be interest from the last payment date to the redemption date, which I guess is what the £1700 represents.

As for how the repayment fee gets refunded, it would probably help if we knew who the lender wasETA, ok, I see from a previous post that it's Yorkshire BS.

Hoenir

stevetuk said:

1. Why am I being charged the interest up front now when the mortgage is being ported exactly as is? Should I contact the lender to ask or the solicitor?

Interest is charged in arrears. This interest will be from the end of the previous month to the completion date. Will come out in the wash over the term of the mortgage. Your next mortgage payment , whenever this is, will cover the interest charge levied.