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  • FIRST POST
    • BearWhite
    • By BearWhite 16th Apr 18, 12:44 PM
    • 570Posts
    • 748Thanks
    BearWhite
    Remortgaging Questions
    • #1
    • 16th Apr 18, 12:44 PM
    Remortgaging Questions 16th Apr 18 at 12:44 PM
    Hi,

    My current fixed rate mortgage ends on the 30th September, so I'm looking to lock in a decent rate now by applying to remortgage with a different lender, starting on the 1st October.

    I don't know exactly how much I will owe on that date and my current lender claims they can't tell me until 2 months before my deal ends with them. Does this matter? I can probably guestimate it pretty accurately (within a few hundred pounds) but I don't want to if it will cause issues.

    Also, my payments with my current lender are taken on the 1st of the month. If I switched on the 1st of the month I assume no payments would be taken from my current lender on the 1st October as this would be the day the switch occurred?


    Thanks
Page 1
    • Luana
    • By Luana 16th Apr 18, 4:34 PM
    • 11 Posts
    • 5 Thanks
    Luana
    • #2
    • 16th Apr 18, 4:34 PM
    • #2
    • 16th Apr 18, 4:34 PM
    You can give them an approximate figure, my broker used my estimation. I'm in the same boat as you. I got a (re)mortgage offer valid until end of August, and my fix rate is ending 31 July, so I'd like to complete on the new mortgage on 1 August. Current payments on the 1st as well.

    Basically you need to be prepared for a payment on the 1st of October... although you might be able to stop it. I cannot post links, but you should be able to see in my profile a detailed answer to your question (from kingstreet).
    • astal
    • By astal 16th Apr 18, 4:46 PM
    • 11 Posts
    • 2 Thanks
    astal
    • #3
    • 16th Apr 18, 4:46 PM
    • #3
    • 16th Apr 18, 4:46 PM
    It sounds a bit ridiculous to not provide the balance to the customers. It is not hard to estimate, anyway. I suppose they do it to increase chances of the customer being tied with them. But this is anti-competitive and non-transparent practice.

    Most lenders would accept a change within last 3 months of the fixed period. In theory, you could switch to a lower rate nearer the beginning rather than the end of the 2/3 monthly period they allow that, and avoid the 1st October payment.
    • dimbo61
    • By dimbo61 16th Apr 18, 5:21 PM
    • 10,019 Posts
    • 5,405 Thanks
    dimbo61
    • #4
    • 16th Apr 18, 5:21 PM
    • #4
    • 16th Apr 18, 5:21 PM
    You pay interest daily and any over or under payment could effect the outstanding balance.
    A figure close to what you owe will do fine
    • Thrugelmir
    • By Thrugelmir 16th Apr 18, 5:22 PM
    • 59,851 Posts
    • 53,217 Thanks
    Thrugelmir
    • #5
    • 16th Apr 18, 5:22 PM
    • #5
    • 16th Apr 18, 5:22 PM
    It sounds a bit ridiculous to not provide the balance to the customers. It is not hard to estimate, anyway.
    Originally posted by astal
    If the service were provided it would create a cottage industry that lenders wouldn't get paid for. As you say easy enough to estimate a figure for remortgaging purposes.
    Financial disasters happen when the last person who can remember what went wrong last time has left the building.
    • BearWhite
    • By BearWhite 16th Apr 18, 8:08 PM
    • 570 Posts
    • 748 Thanks
    BearWhite
    • #6
    • 16th Apr 18, 8:08 PM
    • #6
    • 16th Apr 18, 8:08 PM
    Thanks for all the responses around balance estimates. It does seem ridiculous that they won't give me one but if it's not stopping me then I dont really care.

    Luana - I read the thread you directed me towards with regards to payment dates and it was just what I needed so thanks very much for that.

    I'm just waiting now to see if the L&C broker can beat the best deal I've been able to find and then I'll get the ball rolling.
    • cjm888
    • By cjm888 17th Apr 18, 4:02 PM
    • 29 Posts
    • 23 Thanks
    cjm888
    • #7
    • 17th Apr 18, 4:02 PM
    • #7
    • 17th Apr 18, 4:02 PM
    I'm in the same position as you and the same date funny enough.

    What the lender told me is to go over your estimate as when it comes to the switch they will only pay the outstanding balance whereas if you under estimate you will have to make up the shortfall.
    • kingstreet
    • By kingstreet 17th Apr 18, 5:28 PM
    • 34,134 Posts
    • 18,522 Thanks
    kingstreet
    • #8
    • 17th Apr 18, 5:28 PM
    • #8
    • 17th Apr 18, 5:28 PM
    You know what brokers do to work out how much to apply for when remortgaging...?

    We estimate what the balance will be (get the last annual mortgage statement, see what capital was repaid before, divide that figure by twelve and multiply by the number of months to completion) and try to over-estimate a little, if possible.

    Then once the solicitors get the redemption figure we can either;-

    ask for the offer amount to be reduced
    or
    we advise the borrower to repay the surplus after completion within their ERC-free overpayment limit.

    At application stage, nothing you do is case in tablets of stone. If you over-estimate then a reduction is simple. Ski-ing downhill, you might say...
    I am a mortgage broker. You should note that this site doesn't check my status as a Mortgage Adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice. Please do not send PMs asking for one-to-one-advice, or representation.
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