Mortgage Overpayments

[MrFitz]

I jointly own my former marital home with my ex wife. We are divorced but still kept the property in joint name until we both agreed to sell. She lives there with our children and I rent a place and have the children 3 nights a week.

When we were together, we made a chunk of mortgage overpayments. I'm not sure how much at this point but possibly £10k - £15k. I found out tonight that she has been using these overpayments to reduce the monthly mortgage payments over the last 18 months unbeknown to me.

I naively didn't even think that would be possible. In fact, I didn't even know that was a thing??? Am I right in thinking that this should be more difficult to arrange for one person on a joint mortgage?

I’m a bit confused. Making overpayments reduces the monthly repayments - did you not realise that? Isn’t that good?

Our overpayments don’t reduce the monthly payments they reduce the term.

Yes, same here.

Making overpayments you have two options:

Reduce monthly payments
Reduce the term (length) of the mortgage

Usually when you make the overpayment you would be given the option of which one to do, or the banks t&cs may state which one is done by default.

Usually people have preference for one or the other, probably dependent on whether they are considering the long term benefits (pay it off sooner) or the short term (pay less each month).

Presumably as your wife knows she will be selling soon, she has potential for the latter.

Preference not potential sorry,!

What do you have an issue with? The fact she's done it, or that she's been able to do it without your permission?

Do you still pay 50% towards the mortgage?

If yes, and you are still paying 50% of the original monthly amount, and she is pocketing the excess as the payments have been reduced. I can see why you are annoyed.

If she is paying 100% of the mortgage, I can also see your point. You paid to reduce the mortgage term (and pay it off quicker) but actually you paid in advance for her to pay less. If she was struggling, she should have informed you first and you both agreed to it.

Whatever the situation, she should have informed you as it's a joint loan.

I see what you mean. I think it's time to sell up.

Its a joint mortgage- they will just deal with one of your instructions, that will be in the terms and conditions. I'd sort that out legally tbh

No, they reduce the term.

With Natwest and our mortgage, you can choose whether overpayments reduce the term or the monthly payment.

But you're annoyed that she's reduced the monthly payment and kept the difference, is that what you're saying?

If that's the case, she needs to pay back the difference. She should have told you what the new monthly amount was.

You can choose how overpayments are applied - to reduce the term or to reduce the monthly payment.

OP - what was put in your divorce about the property and who is paying for it now?

With some mortgages you can use previous overpayments to reduce or stop monthly payments.

OP what does your ex say about this? She may be struggling financially and is worried about discussing this with you and affecting your relationship.

For those confused.... You can make overpayments on a mortgage, which generally reduce the amount of money you owe, and subsequently means you pay less interest in total than you would have if you had not made monthly overpayments because the mortgage will be paid off earlier than planned. Some mortgage providers will accept overpayments, but not allow you to take the overpayments back. Other mortgage providers will treat the overpayments you make like a savings pot. So in essence you can take the overpayments back from them, reducing your monthly amount payable to them, but increasing the overall mortgage term again. If you have a joint named mortgage, but don't have the account set to joint permissions, then it is perfectly possible for one account holder only to claim the overpayments back.