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Original poster

Early redemption charge

35 replies

mummynumnum · 06/03/2009 06:48

We are taking advantage of buying a v cheap 4 bed and have sold ours yesterday. Only just managed to avoid negative equity on ours. Have mortgage sorted out. Our mortgage co would not give us a new mortgage as only had 10% deposit and they wanted 20%. Of course now want their early redemption penalty of 8000. Is there anything we can do? We did turn to them first for our mortgages. Or am I just gonna have to suck lemon on this one.

OP posts:
poopscoop · 06/03/2009 06:51

How much more were you looking to borrow from the original company. Were you on a good deal? Has the second compny given you a better deal/low interest. How much longer were you tied into the 8 grand early redemption fee? Wankers though aren't they!

Original poster
mummynumnum · 06/03/2009 07:05

Mortgage with old co was 132. Borrowing 184 on new one. Had to increase the interest slightly to move as well. Have yr left on redemption.

OP posts:
poopscoop · 06/03/2009 07:10

i am useless at the maths, but its such a shame that you have to pay 8 grand to get out of it in your final year. Usually they drop the figure as you get nearer to the end, I suppose that was a recent quote.

Hopefully someone good at this type of thing comes along to see if there is another way round it.

Original poster
mummynumnum · 06/03/2009 07:18

Thats what i am hoping some legal money whizz will give me some impressive jargon!!! We have been good payers for 3 yrs and I think they were just daft to not allow us to re-mortgage with them!!! We have a 10% deposit!!

OP posts:
firsttimemama · 06/03/2009 08:59

No - You'll have to suck it IME

Original poster
mummynumnum · 06/03/2009 11:42

Boo Hiss!!!

OP posts:
Original poster
mummynumnum · 07/03/2009 19:14

Still so frustrated by this!!!!

OP posts:
Lulumama · 07/03/2009 19:16

based on how the economic climate is, i think you are amazingly lucky to get a mortgage with only 10 % deposit!

Lulumama · 07/03/2009 19:16

you could ask about adding the charge to your new mortgage?

hercules1 · 07/03/2009 19:19

Did you not realise this would happen? I would like to sell and buy elsewhere but we have a 8 grand repayment charge too and our company wont give us new mortgage higher than we have now.

Original poster
mummynumnum · 07/03/2009 19:30

I did realise just being grumpy about it!! Never intended on leaving tie in early But found a bargain of house and cant moan but was hoping to re mortgage with existing co so could carry charge over, but as only have 10% deposit just said no, so had to move to new company and hence got to pay erc and therefore now short on deposit for new house and got to max out credit cards. Perhaps I am being bananas about the whole thing. Co def said any re-mortgage would not be a prob when we took out mortgage but obv in this economic climate they have changed their tune!!!

OP posts:
hercules1 · 07/03/2009 19:31

2 years ago our mortgage company were trying to throw money at us - up to 6 times our salary if we moved or wanted to extend etc. I'm glad we didnt but..

Original poster
mummynumnum · 07/03/2009 19:34

Worried should stay put, but got a 4 bed for 205 in the road that we have always wanted and a yr ago would have been nearer 250...

OP posts:
coolkat · 07/03/2009 19:42

But surely you have sold your house for less than it was worth a year ago, so therefore your not really gaining anything!

You are very brave in the economic climate to be stretching yourself, i.e paying the deposit on credit cards.

lalalonglegs · 07/03/2009 19:51

From what I can work out, if you have deposit of around £20,000 for house costing c. £200,000, then you have probably saved about £7,000 on stamp duty if it has fallen in value by 30% (and untold thousands in extra interest paid for moving up the ladder). Doesn't sound so bad now does it? .

Original poster
mummynumnum · 07/03/2009 21:50

So many positives and negatives. The deposit on cards makes me uncomfortable but love the house. Sometimes I wish we had never seen it!!!

OP posts:
noddyholder · 07/03/2009 21:58

Deposit on a credit card is very tricky atm as no one knows what interest rates will do.It is really a sign that you can't afford to move Have you calculated all the agents fees etc and solicitors too?205 will be 165 next yearand you won't have the charge wait!

Original poster
mummynumnum · 08/03/2009 07:14

Oh just dont know what to do!!!

OP posts:
LeninGrad · 08/03/2009 07:36

This reply has been deleted

Message withdrawn at poster's request.

Original poster
mummynumnum · 08/03/2009 08:03

Good points, not sure if can turn my husband around. he is totally in love!

OP posts:
lalalonglegs · 08/03/2009 09:14

Oops, missed the bit about the credit cards. Don't do it. Madness.

overtherainbow · 08/03/2009 16:09

Could you not leave your original mortgage as it is for now and look into taking out a second mortgage for the difference with either the lender you have now or another? We did this. Should be able to as long as your original one is portabable. ie you can move the loan to a new house.

Original poster
mummynumnum · 08/03/2009 17:05

14,000 of the deposit is from sale of house. Only 6000 iss going on cc-is this any better

OP posts:
coolkat · 08/03/2009 17:51

Only £6000! Its hard isn't it but surely if your financially stable where you are you could have a year saving, be free of the £8000 penalty and then buy a better house as you would have saved like mad and not be paying £8000 in charges.

LeninGrad · 08/03/2009 19:33

This reply has been deleted

Message withdrawn at poster's request.

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