Lump payment into Mortgage

Jag1978

Hi All

Fixed rate coming to an end this month with the Halifax. Will have about £122k left. I have about £45k that I can use to pay off a major portion of the mortgage. As it’s a large amount the bank says the only way to pay such a large amount is to let my mortgage run into the SVR and pay off the $45k so I don’t incur any fees. I then wish to move onto a new deal with another lender the following week.

My problem is that my payment comes out of the bank on the 5th of each month. So in theory I will have paid for the full month. Am I entitled to claim the remaining three weeks back if I move into a new deal in the second week of the month or do I have to wait until the month ends, before the new deal starts?

Regards

Jag

herbiesjp

If you are changing lender, you simply re-mortgage for the lower amount with the new lender

You do not have to go onto Halifax's SVR to pay the lump sum

The solicitor arranging the re-mortgage will co-ordinate paying off Halifax and setting up the new mortgage, and so will request the lump sum funds that you are going to use to reduce the mortgage balance. On the first day after your current deal expires (if everything is set up in time) the solicitor will clear the Halifax debt with the funds from the new lender and your lump sum.

I'm assuming you opted for Halifax daily interest, and so, any redemption statement obtained by the solicitor would include any extra payments needed to be made for every day on SVR (in this case only 1 day and not the whole month)

Jag1978

Interesting... I didn't realise it was that straight forward.

Does that mean that if my new deal comes with free legal, would this transfer of £45k to the old lender to reduce the amount be included as part of the free legal or would that be additional cost??

Regards

Jag

herbiesjp

It should be included