to not have understood this about my offset mortgage?

[onesteptwostep]

Well over a decade ago I took out a 25year offset mortgage with my ExP. This was when offsets were a new product and there were only a couple of lenders offering them. It was all done online/ by phone, seemed v new and innovative etc.

We then needed to increase our borrowing to pay for works to the house. With the offset we could use our 'reserve', and basically borrow more money (I think up to about 30k more, though as you pay more off the sum increased).

Anyway basically as the mortgage amount went down, our linked current account went into debt (because of the increased borrowing). My Exp then ran up further huge debts on the account, which led to us splitting up. It ended up we owed about 80k on the mortgage, and were overdrawn about the same amount.

When we split, I was told to freeze the current account to stop him spending from it. I had to open a new account for my wages etc, and then had a standing order to pay the mortgage.

I work hard and am lucky to earn a good salary. By last year, I'd got the mortgage down to a few £100. So I contacted the provider, and said was it ok basically not to pay it (I remembered someone telling me it was better to have a small mortgage balance) and put the same amount into the linked current account, to reduce that? Yes, that was fine, as I owed less than 1 months repayment they wouldn't worry about it, as could see money still going in etc. So I've carried on, and now I owe about £65k only. So far, so good.

Years ago, as well as the mortgage and the current account, my Exp and I also used to have saving accounts linked to our mortgage...these and the current account are meant to reduce interest etc. I'd forgotten about this, but as I have some other savings with a different bank,thought I might find out if I could move it and link to my mortgage. So I gave them a call.

The call didn't quite go as expected. Firstly no one understood about these saving pots (they suggested I go to my branch. Problem is I've never had a designated branch and on the phone they therefore couldn't tell me which one to go to) but worse still I was told I was classed as a bad debtor, and I have 18 months to repay everything I owe

This is because of overpaying the mortgage. I remember exp and I getting yearly letters saying effectively well done, if you carry on you will pay your mortgage off in another X years...etc.

Apparently every time we overpaid we were compulsorily reducing our term. I don't think this was ever made clear. Maybe I'm thick?

But I also don't get why I've never had any letters re the term for at least the last 5 years (the last letter they sent me on their system was in 2009!) or why when I called last year it wasn't mentioned?

Their attitude was well you know now, you should have known already, hard luck. Oh and make sure you pay up your £65k!

So is it all my fault for being stupid?

Normal overdrafts are repayable on demand (so suitable for short term borrowing only) but mortgages obviously have an agreed term.

Get your paperwork out and SCOUR it for anything that might reasonably have led you to imagine that these products work differently to that norm.

I asked what my options were.

They said pay us the £65k in the next 2 years, we will do an 'affordability calculation'. I explained I was paying the max I can afford already so I didn't get what that would achieve, that I don't earn as much as the monthly repayment would need to be, even if I spent every penny of my salary on it.

The other alternative they offered was to remortgage if and only if I got my Exps consent. Which is unlikely.

They weren't willing to discuss it further and kept saying see an IFA.

(Including evidence that it was confusing/ambiguous/incredibly complex)

You need to get ExP off the deeds and mortgage anyway, don't you?

So you need to see a solicitor AND an IFA.

But the £65k is an overdraft, not an outstanding mortgage amount, is that right?

Have you checked your creditworthiness? Has it been damaged (yet)?

It's referred to as reserve borrowing, but in effect an overdraft I guess.

All on the same interest rate as the main mortgage?

It probably has a slightly different status to a current account o/d.

Try to find an IFA who specialises in mortgages and this kind of product, ask around for recommendations if you can and if you approach an independent practice then ask them who would be best to deal with this kind of thing.

To make it as easy as possible when you meet with the IFA have all the numbers to hand - set out clearly the current balance on each account individually and then write down the linkages - don't net them off each other at this stage. Wherever possible dig out paperwork, t&cs for the products etc. Also draw up a realistic assessment of your income and expenditure - do this at a fairly detailed level starting with your compulsory outgoings - utilities, childcare, council tax etc. Make clear what is left over and if you are doing any regular saving flag this up as well as things like pension contributions. You need a complete review of your financial position as depending on what options are available to you you may end up doing some things that seem counter intuitive (eg reducing savings/pensions for a bit to address other debts).

Also have details to hand of any insurances you have - eg life cover, critical illness, unemployment etc as they need to be factored into decisions (eg the amount of savings you need will vary depending on what kind of illness, redundancy cover you have).

Have a look and see how it appears on your credit report.

I've not checked my creditworthiness, I never had any reason for concern til this phone call - hence I was shocked to be told I was a bad debtor and my account was with the collections dept...although when I went through to them, they couldn't help as they didn't know anything about offset mortgages! And admitted they have never written to me. So not sure what the point of my account (allegedly) being with them was. Another thing no one could explain.

I am currently paying just over 50% of my net income into the account. I really couldn't afford to pay more. I've already reduced my pension to the minimum allowed. I don't regularly save,only if I get a work related bonus, or other 'extra' money. No insurances, other than a small endowment which matures in 7 years.

I not an expert but go into a branch and get an appointment. If you show you can pay off in 3 to 4 years surely they will agree to that. Why is your ex p still on the mortgage??

Check it. If the solution lies in a remortgage you'll need a) Clean credit and .b) Your ex removed from the deeds (You might need to buy him out, or not, but you need legal advice. Get that moving in parallel with the financial side.)

I used to work for Barclays (not as a mortgage advisor!) and as I understood this type of mortgage is that once the mortgage comes to an end so do all the linked accounts. Therefore as you have nearly paid off the mortagage, the term has automatically been reduced and the linked reserve will come to an end.

You need to remortgage. Did you speak to the Woolwich mortgage team rather than the general customer services? I would ask in branch for a meeting with a mortagage advisor.

I had the same type of mortgage from Woolwich/Barclays.
Every month I got a statement detailing what I would pay and how much I was saving and what my various balances were. Did you get that? And the annual statement?
Paying off additional sums could either reduce the term or the future payments. It sounds to me that you should have been using additional payments to specifically reduce the reserve balance before you pay off the mortgage. I am sure you could elect to switch between reducing your term and reducing your payments at any time.

Oh and the savings pots should have generated annual statements. Even with no activity. Are you sure your ex hasn't done something with them or changed correspondence addresses on accounts?

I've not had any correspondence saying how long was left on the mortgage for at least 8 years. They tell me nothing to that effect has been sent, it would only be sent on request. But that as I'd overpaid over the last 8 years, the term has reduced beyond what I was told 8 years ago anyway.

Nothing is being sent to my Ex, the only address they have on the account is the one I live at. I did ask.

I get statements for the mortgage/ current account, hence i know the balances. But nowhere on that does it say it's all payable by X date, just says what I currently owe.

The mortgage was less than 1 payment away from being paid off a year ago, when I switched the payments to the current account. So why did the reserve not end then, but on a random date nearly 3 years later?

Have the same type of mortgage and can second/third what people are saying about Barclays not having a clue.

At one point they decided to send dp's personal Barclaycard balance on the monthly mortgage statement addressed to me. When I rang up they could not see what the problem was.
We had a problem in that we were sending our monthly mortgage payments to be credited to our mortgage, we never used our current account, our current account went into credit but we started getting mortgage non payment letters. They would not take the credit on our current account and apply it to our mortgage we had to take it out as cash and then send it to them by cheque. They would not take a payment over the phone.

Anyone who has not dealt with the mortgage department could not understand the hours you spend on the phone trying to explain the product they are supposed to administer. You end up putting the phone down after 90 minutes no closer to a resolution and completely exhausted.

think I'm keeping up, but a few questions: how were you anticipating paying off the 65k debt on the current account? is there interest applied to it or is interest only applied to the mortgage? did you think such a massive debt would be unsecured as your "mortgage" had been paid off? how long did you expect was left on the mortgage before you realised the term had reduced? did you think this was long enough for you to clear the £65k debt on the current account? Finally, is the debt your sole responsibility or can they chase your ex as he's on the mortgage paperwork too?

We have the same mortgage product and they have just written to us advising that they are reducing the amount you can borrow from the reserve account in future. I'm guessing therefore that you are not the only person in this predicament. If that's the case you may find a financial website forum which may be more help.

Fortunately for us we have never needed to use this facility although it was nice to know we could easily access the money if needed. It sounds like we're better off not having that option any more. Hope you get it sorted.

Remortgage! Get a good independent mortgage advisor and see who will lend to you.

As I have said before we did not use the current account but I was under the impression that current account and mortgage account had to be paid off after 25 years or whenever the term of the mortgage was.

Have you checked exactly what your mortgage terms actually says about this sort of situation.

I've read through several times. I think one of the confusions is that you're seeing it as one total. You say 'I owe £300 on the mortgage and about £65k on the current account, so just over £65k'.

That's not how it works though. They are two separate entities with different terms and conditions, but with one off-setting the other.

The mortgage account is (obviously) the money you owe on the house. As you pay into it, the amount you owe on the house is reduced. You're charged interest on the balance.

The current account balance (when positive) is offset against the mortgage in such a way that they only apply interest to the amount of (mortgage-current account balance).

The current account 'overdraft' is actually a secured interest only loan against your home. The Barclays site says that this must be paid off at the end of the mortgage term.

You've been trying to pay off the mortgage but in doing so you've been reducing the term of it. If I've read your posts correctly, you've cleared around £95k of debt. So if you'd decided to clear the current account first, you'd have a mortgage of £65k with not much in your current account.

You do need professional advice. I feel for you.

Seriously, get legal advice. With your ex still on the mortgage, you're both jointly and severally liable which, as you know, means if he won't pay the bank will come after you for the full whack.
It also means he's entitled to half of any equity in the property.
How do you hold the title - tenants in common or joint tenants? What happens to your share of the house if you were to die - do you want him to get it?