Paying off mortgage - the procedure

greenwich

I have a leasehold flat with an Abbey mortgage. The mortgage still has a few years to run but I have got enough money together to pay it off now. Do I need to hire a solicitor to do that for me, or can I just give the money to Abbey and trust them to take care of it?

Bossyboots

No you don't need a solicitor. Abbey need to complete a DS1 form for the Land Registry. You will need to pay them the funds and they can send you the form which you then need to send on. They could do it electronically but when we paid off our Abbey mortgage, they were about as helpful as a chocolate teapot and we had to pay for the privilege. Ignoring any early redemption fees you might have, Abbey wanted to charge us an £80 deeds release fee and a further £100 to complete the paperwork rather than instruct our own solicitor. We just paid up the deeds release fee and the mortgage monies and they forwarded a paper DS1 to be sent on to the Land Registry for lodging. There was no Land Registry fee payable for that.

greenwich

Thanks. At the moment Abbey charge an outrageous £225 "Repayment fee" when you pay off the mortgage. I am making a complaint to the Financial Ombudsman about that though I don't hold out much hope that they will be bold enough to find in my favour. All lenders milk their customers with these fees nowadays and the Ombudsman will make himself very unpopular with them if he upholds my complaint.

Scott

Your complaint probably won't be upheld by the Ombudsman unless there are extenuating circumstances, they already came down on the side of the lenders.

If your property is in England/Wales, then you won't require a solicitor. If it's in Scotland, you'll be able to pay off the mortgage yourself, then you'll need a solicitor to discharge the security.

For English/Welsh cases, the lender will then call up your deeds and split them, sending one half to yourself and the other half to the Land Registry (there's no need to go into details of what half goes where) who will discharge the security held over the property before sending the other half of the deeds onto yourself.

All done.

Fatboy_NSS

The fee is bog standard and you would have been told about it before you signed up to take the mortgage in the first place. It's a standard fee for releasing the deeds so you won't be able to get out of it I'm afraid.

Thefunkygibbons

And once you have done it, you need somewhere very safe to keep your deeds

Might be worth buying a fire proof safe for the house

greenwich

Yes, the fee is standard but the amount has gone up shockingly. I know someone who paid off an Abbey mortgage two years ago and was charged £99. Now it's £225. They claim it's only to cover their costs but obviously it's a source of profit from captive customers.

I am not sure I do need to worry about the deeds. The Land Registry holds deeds electronically. My friend who paid off his Abbey mortgage got a new one from Nationwide. Abbey sent the deeds to Nationwide, who sent them to my friend, saying they didn't want to keep them. If the lenders don't bother keeping the deeds, they can't be valuable, can they?

Scott

Yes, they are. They're very useful when you get into leasehold disputes, etc, for establishing what has happened in the past on the property.

Definitely worth keeping, and your local branch of your bank will probably hold them for a reasonable fee, or a solicitors.

Ian_W

For reasons fully explained HERE I may shortly be paying off my mortgage and this thread is very, very helpful. Thanks guys. :T

Apart from the expenses described above. Is there any problem a few months down the line mortgaging again [don't suppose it's strictly re-mortgaging if you haven't got one!] to raise capital for another property purchase? Will the hoops to jump through and expenses incurred - just be those you would normally get when remortgaging? If free legals/valuation etc are offered for a remort would they normally be offered for a new one in these circs? Any info would be appreciated.

Ian_W

Thanks Al. I did realise that. It was more - is it treated like a re-mortgage, sometimes better offers -free legals/vals etc - or like a new application?

herbiesjp

Most (not all) lenders will treat as re-mortgage of an unencumbered property and the deals that go with that status - so yes you can get free legals with some lenders.