Is it better to keep a mortgage?

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  • AnotherJoe
    AnotherJoe Posts: 19,622 Forumite
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    If its ending anyway, no it certainly isn't worth the cost and hassle of getting another mortgage when you dont need the money. Close it down when it ends.
  • kingstreet
    kingstreet Posts: 38,770 Forumite
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    In future, if you need one, a remortgage of an unencumbered property can be done free. There are plenty of products with free legals or a cashback and without product, valuation or arrangement fee.

    Keeping open an account which will end in a few months achieves nothing.
    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.
  • jackomdj
    jackomdj Posts: 3,073 Forumite
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    When you say the term ends I assumed you meant a rate so you would be going onto the SVR rather than the current mortgage was ending.
  • kingstreet
    kingstreet Posts: 38,770 Forumite
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    lisyloo wrote: »
    The mortgage term ends in 2018, so I have no automatic right to keep it open. By default it will end.
    jacko? Did you get that? ^
    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.
  • lisyloo
    lisyloo Posts: 29,617 Forumite
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    edited 10 February 2018 at 6:26PM
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    kingstreet wrote: »
    Keeping open an account which will end in a few months achieves nothing.

    Disagree. I!!!8217;ve stoozed and made a profit of between £1k and £8k for a number of years. That!!!8217;s not nothing but my original post refers to keeping it open for longer I.e past the current mortgage term for example another 10 or 20 years (maybe 15 to fit in with state pension age). Apologies for not making that as clear as it should have been.

    Having a charge on a property has several benefits listed in the first post I.e. reducing the chance of fraud, a cheap immediate line of credit. the question was - is it worth it as I don!!!8217;t have a detailed understanding of process and likely costs in this situation.

    For example I don!!!8217;t know whether extending means a new charge or simply not removing it as I don!!!8217;t know whether a charge on the property has an end date. If they are not dated the logically it!!!8217;s actually LESS work to do nothing than to pay to have it removed so an extension would be less legal work that a mortgage ending, but as I said this is the kind of thing I don!!!8217;t know.

    The consensus seems to be it isn!!!8217;t worth it.
  • kingstreet
    kingstreet Posts: 38,770 Forumite
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    Sorry. I thought we were talking about future benefits, not what you'd accrued in the past.

    Seems there's plenty of unanswered questions before any conclusion can be reached...
    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.
  • jackomdj
    jackomdj Posts: 3,073 Forumite
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    kingstreet wrote: »
    jacko? Did you get that? ^

    Yep got that now, but I was just clarifying that my original post referred to the opening statement, "being in the fortunate position to pay off our mortgage" I did not realise that meant the mortgage had run its course.
  • jackomdj
    jackomdj Posts: 3,073 Forumite
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    lisyloo wrote: »
    We’re you extending the term?

    Did you have to pay legal fees, survey, mortgage application fee?

    If all that applies I’m wondering if the costs exceed the benefits?

    We paid certain fees, legal, survey as we were moving to a substantially bigger house. We adjusted the term slightly too.

    It was worth it because we are not fully offset and we needed the additional capital and it was such a great rate.
  • Thrugelmir
    Thrugelmir Posts: 89,546 Forumite
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    lisyloo wrote: »
    D
    For example I don!!!8217;t know whether extending means a new charge or simply not removing it as I don!!!8217;t know whether a charge on the property has an end date.

    The mortgage charge has no end date. That remain in place until the debt is repaid. However you've signed a contract agreeing to repay a debt (the loan commonly refered to as a mortgage) by a specified date.

    To extend the repayment of the debt. You'll need to apply for a new mortgage. Which will result in a new product, You won't be able to keep your existing low interest rate mortgage, If that's your hope.
  • lisyloo
    lisyloo Posts: 29,617 Forumite
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    kingstreet wrote: »
    Sorry. I thought we were talking about future benefits, not what you'd accrued in the past.

    Seems there's plenty of unanswered questions before any conclusion can be reached...

    Just to be clear my perception of perceive FUTURE benefits of extending/remortgaging are

    1) having a charge on the property makes it much harder To carry out a fraudulent transaction than an unencumbered property

    2) having a large and cheap line of credit available for the next 15 years at minimal cost (zero interest if fully offset). A mortgage may not be available to us in 2 years time if (for example) DH retires.

    3) anecdotally I’ve heard that a mortgage on a credit report can be an advantage. I admit this I should more tenuous and purely anecdotal.

    Quite happy to answer any other unanswered questions.
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