# Remortgaing: Does this sound correct?



## Simmo (Aug 31, 2008)

Hi, looking for a bit of advice.

My current fixed rate mortgage has a year to run, however the lender got in touch to say I could fix early for another 5 years with no fee, or could leave early to another lender with no penalty, only a £49 release fee.

I am going or option 2, but also want to take the chance to remove a lump in one go, and that way access a better rate based by improving my LTV.

Originally the new lender said this would be no problem,I give them the money, so the mortgage which I now have approved (pending valudation) from them is less than my redemption quote. However then they said to me that I would need to pay that money to my exisiting lender, who obviously said there would be overpayment charges for that!:wall:

I have spoken again to the new lender who says the next steps are as follows:

Value my house
Send out the offer docs
I sign up
They refer it to there solicitor to settle my old mortgage
They will get the figure, which will be higher than my approved mortgage wonder how the difference will be made up?
They will contact me
I will CHAPS the solicitor the money
They will settle the whole thing with the original lender on my behalf.

That all sounds reasonable to me But it would as its what I want to hear! But after such conflicting information, does that sound right to you?

Thanks!

Feels like I am the 1st person ever to want to pay something back early, and not borrow more!


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## Richf (Apr 26, 2008)

Seems overly complicated to me but i can see why they are doing it that way 

Might be worth speaking to your solicitor to see what he thinks , they do this kind of stuff every day 

Another option would be to take out your new mortgage for 100% of the old one making sure there is no overpayment charge and then pay off a chunk once its all done and dusted


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## Simmo (Aug 31, 2008)

thanks for the reply.

If I just get the new mortgage for the full amount the rate is 3.99, if I can get the chunk off it improves my LTV so the rate becomes 2.79, which is a big incentive out in the choppy sea of variable rates!


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## rich1880 (May 26, 2010)

Sound like the correct procedure to me woth it with the LTV rate you mentioned you will be quids in !!


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## mba (Jun 17, 2006)

Let me know how you get on as mines up for renewal in September and i might look at swtiching vendo & taking a lump off it to lock in a better ate.


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## Rob_Quads (Jul 17, 2006)

2.79 seems like a good rate to get fixed on - how longs it for?

As for the process - sounds simple enough. Check your existing mortgage as you may well be able to make over payments. I was allowed to make up to 10% in a year without penalty.


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## evosport (Mar 27, 2008)

As a mortgage broker, will all depend on loan to value and size of mortgage you have, and also your future plans.

No point taking 5 year fixed if moving in 2 years time


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## 80skid (Nov 9, 2009)

Ive just done done exactly the same thing, infact, mine completed on Friday

You basically have 2 options

1. Pay the lump sum over to your existing lender to reduce your balance (this is what I did as I didnt attract any early repayment charges)

OR

2. Pay the lump sum over to your solicitor, who will add it onto the money borrowed from your new mortgage provider in order to pay off your old mortgage


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