Your browser isn't supported
It looks like you're using an old web browser. To get the most out of the site and to ensure guides display correctly, we suggest upgrading your browser now. Download the latest:

Welcome to the MSE Forums

We're home to a fantastic community of MoneySavers but anyone can post. Please exercise caution & report spam, illegal, offensive or libellous posts/messages: click "report" or email forumteam@.

Search
  • FIRST POST
    • JennyP
    • By JennyP 12th Apr 18, 5:01 PM
    • 958Posts
    • 762Thanks
    JennyP
    Question about overpayments....
    • #1
    • 12th Apr 18, 5:01 PM
    Question about overpayments.... 12th Apr 18 at 5:01 PM
    I am keeping a diary but wanted to ask a specific question.

    I have two buy to let mortgages that I am trying to pay off. Both are currently on a fixed rate so there is a maximum overpayment amount that can be made each year. They are with different companies.

    I paid the maximum amount off on each last week from my savings to give myself a headstart. Each mortgage company then sent me a letter saying that my monthly payments were going to be reduced.

    I rang the first company and said please can you keep it the same as it was as I am trying to pay it off earlier. They said fine.

    I rang the second one and they said if I keep the mortgage repayments the same, then that would count as extra overpayments so I cannot do it without penalty.

    Does that sound right? I was surprised. I thought I would be allowed to keep the payment amount the same and make the maximum overpayment.
Page 1
    • greent
    • By greent 15th Apr 18, 11:33 AM
    • 7,735 Posts
    • 78,875 Thanks
    greent
    • #2
    • 15th Apr 18, 11:33 AM
    • #2
    • 15th Apr 18, 11:33 AM
    It's probably in the super small print in the t&cs - but technically the 2nd company are correct in saying that the extra amount is an OP - and so would therefore be liable for penalties.

    How about setting the extra for mtge 2 aside into a savings account each month? The mtge won't be reducing by this amount, but you're creating a sort-of offset for you, so you can net them off when figuring out what you owe? When the fix ends you can then pay this saved lump off the mtge.
    I am the master of my fate; I am the captain of my soul
    Repaid mtge early (orig 11/25) 01/09 £124616 01/10 £104927 01/11 £89873 01/12 £76317 01/13 £52546 01/14 £35356 01/15 £12133 07/15 £NIL
    BTL Mtge 12/16 £69786 12/18 £54829 2019 OPs (#18) £421.46/£5K
    Net sales 2019 £33.81/£500
    • Old Git
    • By Old Git 15th Apr 18, 2:54 PM
    • 4,333 Posts
    • 3,763 Thanks
    Old Git
    • #3
    • 15th Apr 18, 2:54 PM
    • #3
    • 15th Apr 18, 2:54 PM
    another option might be to overpay mortgage 1 by more than you had planned .
    "Do not regret growing older, it's a privilege denied to many"
    • greent
    • By greent 15th Apr 18, 3:42 PM
    • 7,735 Posts
    • 78,875 Thanks
    greent
    • #4
    • 15th Apr 18, 3:42 PM
    • #4
    • 15th Apr 18, 3:42 PM
    another option might be to overpay mortgage 1 by more than you had planned .
    Originally posted by Old Git
    Although that would depend whether provider 1 would allow penalty-free increased payments after the 10% OP, as opposed to just keeping payments the same as the previous amount
    I am the master of my fate; I am the captain of my soul
    Repaid mtge early (orig 11/25) 01/09 £124616 01/10 £104927 01/11 £89873 01/12 £76317 01/13 £52546 01/14 £35356 01/15 £12133 07/15 £NIL
    BTL Mtge 12/16 £69786 12/18 £54829 2019 OPs (#18) £421.46/£5K
    Net sales 2019 £33.81/£500
    • JennyP
    • By JennyP 15th Apr 18, 5:27 PM
    • 958 Posts
    • 762 Thanks
    JennyP
    • #5
    • 15th Apr 18, 5:27 PM
    • #5
    • 15th Apr 18, 5:27 PM
    They won't.
    • greent
    • By greent 16th Apr 18, 12:39 PM
    • 7,735 Posts
    • 78,875 Thanks
    greent
    • #6
    • 16th Apr 18, 12:39 PM
    • #6
    • 16th Apr 18, 12:39 PM
    They won't.
    Originally posted by JennyP
    In which case the personal offset with the 'extra' from Mtge 2 saved into a separate account until the fix ends seems a reasonable compromise, I'd guess
    I am the master of my fate; I am the captain of my soul
    Repaid mtge early (orig 11/25) 01/09 £124616 01/10 £104927 01/11 £89873 01/12 £76317 01/13 £52546 01/14 £35356 01/15 £12133 07/15 £NIL
    BTL Mtge 12/16 £69786 12/18 £54829 2019 OPs (#18) £421.46/£5K
    Net sales 2019 £33.81/£500
    • JennyP
    • By JennyP 16th Apr 18, 8:21 PM
    • 958 Posts
    • 762 Thanks
    JennyP
    • #7
    • 16th Apr 18, 8:21 PM
    • #7
    • 16th Apr 18, 8:21 PM
    That's what I'm doing!
Welcome to our new Forum!

Our aim is to save you money quickly and easily. We hope you like it!

Forum Team Contact us

Live Stats

206Posts Today

1,471Users online

Martin's Twitter
  • RT @paullewismoney: People who were students 1990-97 are being offered the chance to pay off half their unpaid student loan and the other h?

  • As normal I am signing off twitter for the weekend - to spend time with mini and Mrs MSE. Hope you have a wonderfu? https://t.co/FG3sRfkIgA

  • RT @LauraFrancis9: Top crew! We may film in the freeeeeeeezing cold every week, but this bunch make it fun. (And huge thanks as always to @?

  • Follow Martin