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Old 08-12-2014, 19:31   #1
tomos
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would there be a charge to pay off mortgage?

parents have brought forward the possibility of paying off my mortgage (about 28k left) in full. i'm sure though that there would be a fee/penalty for this from barclays which would probably make it unpalatable. the other option they brought up was paying the max extra i could per year without incuring penalties.

is there a way to pay off the mortgage without being charged a ton, or at least to pay off more? even if it means moving from 1 company to another?
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Old 08-12-2014, 19:39   #2
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It will vary depending on your lender.

Sometimes they have an early redemption fee, which you'd need to pay if you remortgaged anyway.

I know someone who actually changed product with the same lender for this exact reason as the new product was more "expensive" but had early redemption fees removed.
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Old 08-12-2014, 19:45   #3
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Are you in a fixed period? I have one for five years, I can pay off a max of 10% a year without incurring costs. Even if you do have to pay a fee, I recall mine was about 3%, probably a lot cheaper than paying interest for a number of years.

There are normally some smallish charges to get your deeds back or something at the end, a hundred quid or so. I've never paid mine off so not sure.
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Old 08-12-2014, 20:23   #4
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It would show on your initial agreement. I know mine shows on the annual statement, although that's not Barclays.

I'm sure a few years ago banks decided to amend contracts with "admin fees" and "early repayment fees" but were slapped by the financial ombudsman...
Quote:
In applying the law here, an early repayment charge does not form part of the contract unless it was brought fairly to the attention of the consumer, before they committed to the contract.
http://www.financial-ombudsman.org.u...t-charges.html
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Old 08-12-2014, 21:14   #5
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I know they've got to make money, but the government should enforce these banking ***** to encourage early repayments!
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Old 08-12-2014, 21:26   #6
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going to book an appointment with barclays tomorrow. hopefully for saturday. will find out then what options i have. would be nice not to have those mortgage payments coming out every month mind
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Old 09-12-2014, 08:03   #7
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When did you take out the mortgage? Its unlikely there'll be some hidden small print, they would have made you quite aware of it. If you've only got £28k I duoubt you'd be on a fixed rate now, but you might be.
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Old 09-12-2014, 08:52   #8
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Tomos, a question for you. Are you near retirement, if not why have you not continued to keep buying bigger?

Must be a lovely feeling not to have that payment each month though, mine is almost half my salary!
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Old 09-12-2014, 09:59   #9
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Maybe he didn't want to spend half his salary on a bigger house
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Old 09-12-2014, 10:18   #10
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Why would you buy bigger if you don't need to? That would be extra money needed on heating, lighting, maintenance, insurance & repayments.
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Old 09-12-2014, 10:22   #11
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If you buy a bigger house than you need, you free up a smaller house for someone less well off than you. It's called The Brand Conundrum and it almost caused the internet to break!
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Old 09-12-2014, 11:39   #12
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i bought it in 2009 (was a steal at 68k). no, nowhere near retirement. at the moment i just want to not have that drain on my outgoings each month, maybe in a few years have some savings and then buy somewhere else and rent this one out. think i could get about 500/month as it's dead in the city centre in a really good location.
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Old 09-12-2014, 12:56   #13
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Quote:
Originally Posted by Jim989 View Post
Why would you buy bigger if you don't need to? That would be extra money needed on heating, lighting, maintenance, insurance & repayments.
Because while you can afford too you keep paying as much as you can, buying a bigger and more expensive house each time, as house prices go up on a percentage you are increasing your investment. Then by the time you are ready to retire you live in a very large house worth a lot of money.

You can then sell the house and downsize, maybe buy somewhere abroad and either enjoy your retirement with lots of money or help your children out.

I don't have a pension so this is my plan and I live in the south where property prices are stupid, I'm intending to sell my 3 bed flat for £500,000 in three years time.

Of course house prices could fall but I think its unlikely.
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Old 09-12-2014, 13:05   #14
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Or you could just buy a 2nd place and rent it out, achieving a perpetual pension without going through the process of shifting from one place to another and gambling on high interest rates and house prices.
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Old 09-12-2014, 13:18   #15
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I rented out a place one, it was a total nightmare.

Nah, I would rather live in a really nice big house!
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Old 09-12-2014, 15:05   #16
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I paid mortgage off in March 2014 as it was 5.18%(10 yr Fixed with 3 yrs left). Early repayment Charge was 1100 extra on top so 38k repayment figure.
Saved 2.5k though if I carried on paying Fixed DD and then £500 max each month.

If it had been out of Fixed period then would have just payed redemption charge of £90 I think it would be.
All the information should be on yr last Annual statement.

I could rent my flat out for £650-700, pay the service Charge (£168),pay tax on it and still be quids in which is what alot in my block seem to do so dont give a **** about how bad the rubbish dumping is? They dont live there and 'Service Charge' increases are passed onto the tenant in rent increases.

Thought about renting but too much hassle for me so going to sell it,take the money and run!
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Old 09-12-2014, 16:05   #17
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Ouch, that was a killer of a rate to be fixed on!
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Old 09-12-2014, 19:40   #18
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Not at one time, about 2009. I was paying 5.69% 2 Year Fix
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Old 09-12-2014, 19:59   #19
Arthur Fowler
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Been fixed on much higher rates than that in the past!
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Old 09-12-2014, 21:25   #20
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Quote:
Originally Posted by daboy3000 View Post
Ouch, that was a killer of a rate to be fixed on!
Interest Rate at the time was 5%,It went up as high as 5.75% before it went into Free fall! The Standard mortgage amount was £567 which is what rent would have been on a studio and mine is a 1 bed so just looked at it like that.
The other one Id considered was a Woolwich Lifetime tracker at 0.69 Base rate which would have been more expensive at the time but lots cheaper from 2009.
If only Marty had been around with the Doleron and I know what I knew now!!!!! I wouldnt buy the place .

I did work out recently that if I sell it for what I pay(no increase) but obviously its gone up then and service charge,all fee's for buying and deposit etc then I'll still be 12k up on renting for 8yrs.
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