Paying off mortgage - First Direct sounding very casual?

[HappyMamma2023]

My Dad passed away last year and we received an inheritance so we are paying off 1 of 2 mortgages with First Direct. Just rang them and they said they'll send a text with the redemption fogure and I need to pay by 6pm same day. I asked how to do this expecting to go to the bank and do a Chaps payment. They said I can do this on my online banking app? I don't know what I was expecting perhaps a letter sent in the post? It sounds quite cadual and it's a lot of money so it's making me feel a bit worried. Anyone else paid their morthage off early with First Direct? It's £66k so quite a lot of money. Thank you

It wasnt first direct, but when we paid ours off with HSBC thats exactly what happened. We rang them, they gave us a figure and we transferred that amount to the mortgage account on line, and that was that.

Why do you think it should be more difficult? You owe what you owe and if its paid by the end of the day then its cleared. Electronic banking at its best.

I am so looking forward to a similar experience later this year. Hope it goes well for you

Yes this is what happens, big or small amounts the process is the same. You have to pay it the same day as the calculation due to the interest calculations, it changes day by day. If they sent a letter by the time the letter gets there, the amount would be different.

Thank you for the reply. I just expected it to be more difficult I suppose! This has made me feel better about it, thank you.

i transferred the money using their app - I didn’t even contact them for a figure!

I think it would be best to do it as early in the day as you can, I would have thought you will get a call from the bank for that amount.

Oh yes I should have thought about this. Thank you! Just waiting for the text now not sure if we'll get it today or not.

It sounds like they have given you for a figure for redemption today. That figure will only be valid if you pay today because if you leave it longer there will be more days interest to add.
If they send you a letter it will be out of date before it arrives.

We're not with first direct but when we did this we did it all online and could specify a specific day we wanted to pay it on. They gave us a redemption figure for that specific day and we just paid it on the day.

Sorry, crossposted with everyone else 😁

Op - before paying it all off, are you still in a fixed rate and will need to pay an early repayment charge (ERC) to close the mortgage?

If so, as first direct allow unlimited overpayments you would be best paying off most of the mortgage balance and leaving around £500 balance and asking First Direct to replan/calculate your monthly DD payments for the remaining term. You can then calculate how much extra to pop in each month to have it paid off by the time the ERC expires.

We did this and instead of paying a £2k ERC fee(as usually it’s based on the initial amount you borrowed at the start of the fixed term, as opposed to the balance of the mortgage when you want to pay it off early), we just paid the bulk off and then £30 a month until our fixed rate expired and paid a few ££’s in interest each month for c.18months.

The total amount of interest we paid was tiny, so we saved by not forking out loads on the ERC fee.

The last bit of cash we would use to pay off the mortgage at the ERC expiration date then sat in a savings account earning similar interest to the interest rate of our mortgage, so that offset most of the mortgage interest we were paying.

I have done this for a mortgage where the amount was over £200k - I couldn’t do it all in one payment due to daily payment limits so split with my brother and set up payments on the redemption date

as it was I paid about £3 too much - Halifax just sent me a cheque back for the balance over which was fine

That does sound normal, but agree isn't disappointing anticlimactic, expecially if you've spent half your life paying it off. Maybe while your waiting on the text you could pop to the shop and buys a bottle to open at the minute you press send on the bank app. 🥂 🍾

This is what I did!! It did seem anticlimactic but as time has gone after I have a lovely calm sense of relief that it’s not there anymore

I agree that paying of your mortgage feels like it should be a momentous occasion but the reality is that its as simple as this.

Thanks for this it is something to consider. They mentioned something like this but I didn't know what it was. Not had the redemption text/figure yet so will talk to my husband tonight and see what he thinks. We both feel very lucky paying off the mortgage in our early 30s, but I wish my Dad was still here (obviously I wish this all the time), but he was so good at things like this and would give good advice.

I paid off ours with NatWest recently and it was similar.

We haven't paid off our mortgage but have periodically paid large chunks off our First Direct mortgage and just transferred the money from our first direct current account the mortgage account.

Is the money in a first direct account? When we were moving money for our deposit before buying we were limited on how much we could transfer between different banks per day so had to set move it over a few days. I think most had a £25k limit but recollection is hazy

Yes, it’s very anticlimactic. They should programme some kind of confetti effect at least.

We paid off a small amount first to check it all went through ok, then paid more in £5-10k chunks.

Love this!!

I find lots of things weirdly casual like this. To pay of my student loan I just sent them the money as a payment. Called them up after to check and they were like ‘yeah it’s done’ no letter to finish or anything.

I did this last year with Halifax, you book a date in the app for redemption and then I went to my bank to make payment as it was over 100k. I waited till the fixed rate was over so I didn’t get charges. It wasn’t exciting, but I didn’t expect it to be because mine was only being paid off due to my DH dying. I then got a letter confirming the mortgage is closed.

Did you get a confirmation the mortgage is officially closed? I was told you can’t just transfer the remaining balance, you need to request the redemption figure. That was Halifax though.

We paid ours off with NatWest, exact same, got the redemption figure, transferef the money, had to do it in two payments as the bank wouldn’t do it all at once, then natwest said we had paid half, set up a new payment schedule, so I called them and they said oh we will look for it, then came back and said yes we have it, but still wanted monthly payments, they then then messed around , a lot, due to apparently how busy they were, before confirming it was paid off, had to phone about 4 times, was utterly painful, I did say to them this is supposed to be a celebratory thing and you’ve made it as painful ss possible.

but yeah, that’s all there is, you get the number, transfer the money and it’s done.

Halifax are the same they give a redemption figure and you have to pay it online. They don’t accept it over the counter inside the bank.
We had to do it in instalments as we can only transfer 25K per day. Didn’t have to pay it the same day if I recall correctly