[Terry&Sophie]

Hi all,

I'm in the process of putting my flat in the UK on the market but have just found out that I will be charged at least £2400 in early repayment fees because the 2 year tracker period doesn't run out until August! :eek :eek

Does anybody have any ideas for how I can avoid this? :no

Unfortunately renting the flat isn't an option because we couldn't get enough to cover the mortgage payments, and delaying the move to NZ is also not possible because flights are booked for Jan 26th! :eek

I realise it's a long shot, but any advice would be good. :hopeso

Thanks
Sophie

[Timbo]

Thats is bad news Sophie. The only thing I can think of trying, is slapping the extra 21/2 k onto the asking price and keeping your fingers crossed.

[richard]

It cost us £4020 to get out of our mortgage. A 5 year fixed seemed like a good idea 2 years ago. It is unfortunately one of the costs you have to take in to account when deciding to make the move.

Selling the house, buying flights for 4, shipping the cat and possessions to NZ, car hire to/from the airports, accommodation for the first week in NZ came to £18,600 in total :eek.

Add on the cost of buying a new car as I had a company car in the UK as well as the cost of getting my 'toy' car in to the country and the total climbs to over £27k.

If the house prices are starting to wobble in the UK you may actually save in the long run by selling it now.

[Paul]

Hi all,

I'm in the process of putting my flat in the UK on the market but have just found out that I will be charged at least £2400 in early repayment fees because the 2 year tracker period doesn't run out until August! :eek :eek

Does anybody have any ideas for how I can avoid this? :no

Unfortunately renting the flat isn't an option because we couldn't get enough to cover the mortgage payments, and delaying the move to NZ is also not possible because flights are booked for Jan 26th! :eek

I realise it's a long shot, but any advice would be good. :hopeso

Thanks
Sophie


Sophie

Only way I could see is to delay departure and move flights to August. Your admin cost for this may be less than the penalty on mortgage? Arguably flat may be easier to sell end of summer and prices may have risen slightly?

Bearing in mind your imminent departure I don't see any other ways of preventing the charge unfortunately :(

Good luck

Paul

[Wannaway]

We got stiffed for a 4.5k early redemption fee. We figured it is a price to pay to get what we wanted (and we certainly did not want to delay selling the house just to avoid the fee - we would certainly have had to take a drop of more than the redemption penalty if we had waited).

I don't think there is any point taking the matter up with your lender, unless the early redemption penalty was not in the original documentation when you signed up (extremely unlikely). You will need to weigh up what is most important to you right now, take a deep breath and just go with it!

Lee & Nicky

[Moorf]

*drum roll*

We paid a massive £12,500 as our early redemption fee, we tried everything to get out of it and even put our accountant on the case, to no avail.

The only possibility might be to rent out the property until such time that you can avoid the redemption fee.

[Terry&Sophie]

Hi everyone and happy new year,

Thanks for all of your advice and for letting me know that I'm not the only one in this position!

Looks like we'll just have to live with the extra cost and hope we get a good offer for the flat to cover it. First viewing is booked for Tuesday so fingers crossed! :hopeso

Feeling a little better now that I've recovered from the shock... what's £2500 for a better lifestyle!? :nice1

Thanks again

Sophie

[kiwidebs]

Just wanted to wish you luck with the house sale. The reason we are waiting till late Summer to put our house on the market is the redemption penalty. We decided £7000 was too many potential nz$ to throw away. Hope your flat sells quickly for you.

Debs

[foolsgold99]

After seeing this thread we've done a bit of research and find ourseleves facing a 2.5k fee in June / July 05 when we plan to move. This money can be put to far better use.

So I've did a bit of reading and one of the clauses says that this fee does not apply if you move to another mortagae with the same building society (Nationwide).

We're thinking about remortgaging in around May, perhaps extending a bit (maybe 10K or so for a "improvements", but really just stick the cash in our savings account.), and move onto the SVR. Then selling a month later.

Hey Presto ! no redemption penelty and business class flights to NZ for us.

Do you think this'll work ??

Alan & Sally

[Timbo]

Hi Alan and Sally. It may have worked if you had not gone and admitted what you are up to on here. I am senior management with Nationwide, and have made a note on your file. :laugh








Kidding. I doubt if it would be quite as simple as it looks. The lenders always have a way of twisting things around. It may be worth a try, as long as they dont charge you silly money for valuation/admin. fees etc.
Good luck.

[jo b]

Timbo,

Do I detect an evil streak in you :laugh

jo

[Wannaway]

Alan and Sally,

Sorry to be pessimistic but Banks and Building Societies usually cober themselves really well. Are you sure that the waiver of redemption penalty applies if you remortgage beore the end of the fixed/discounted/capped period that the penalty applies to? You will need run through a 'scenario' with them I think to be sure that it won't apply. There's no point trying to be clever if they still get you for the penalty and fees for remorgaging too!!

Nicky

[Terry&Sophie]

Hi Alan and Sally,

Interesting thought... and probably worth investigating if you've got that long to sort it out. I think it may be a little too late for us (hopefully, if someone buys the flat soon!).

Like Nicky and Timbo I'm sceptical about it actually working though. It seems like they've worked everything out so there's no wait of avoiding it.

Good luck and let us know if you find out any more! :hopeso

Sophie

[Moorf]

We also investigated the remortgage with same co. route... nope, they had that covered too!!

We were with Shabby National.

[Terry&Sophie]

Shabby National for me too... did we just pick a bad one or are they all the same? :(

[markkellaway]

Bl***y hell, Moorf, how big was your mortgage?!?!!!!!

I've got a 2 year tracker with nationwide, they now do a sliding scale on their early redemption. On my 2 year deal if I'd gone at the beginning of year 1 I would have paid 2%, at the beginning of year 2 it would have been 1%. It slides each month you eat into the deal so if we sell in the summer we are only looking at a few hundred quid!! Told the lady at the building society she'd made me a very happy man! :clap
The numbers do depend on the number of years the deal should run, for example at the beginning of 5 years the fee starts at 5%, 4 years it's 4% etc. etc. For all Nationwide customers it's worth giving them a call. It looks, from the Web site and from what I've just been told on the phone, like all of NW's fixed and discounted products have this sliding scheme applied, even if not the case when you first took out the mortgage.

Mark. :P

[Paul]

Unfortunately if you accept that you are getting a discount when you sign up for these deals then you have to realise the banks are going to tie you in otherwise everyone would take the special offer and remortgage every couple of years to get another offer. If everyone did this then some of the smaller lenders would go out of business which would not be good for consumers! As they say there is no such thing as a free lunch!

Best advice surely is to only sign up for a special offer deal if you are sure you won't be redeeming ie emigrating within the tie in period. Also rememner these special offers do not usually end up working out cheaper in the long term anyway

I appreciate this doesn't help those who took these deals a few years ago before they considered emigrating perhaps :(

[Moorf]

Yep, we weren't thinking of emigrating at the time of purchasing our UK house and took up a deal which locked us in for 7 yrs... :eek

And.. we locked ourselves in and the year later the interest rates took a dive :eek

If only I had a crystal ball... :laugh

By the way, there is a programme called "Close Up" here in NZ - it's a documentary covering current topics etc and there is one coming up soon which may be of interest to those planning to buy.. the trailer says "the baby boomers in NZ will soon be looking to offload their biggest asset.. their house - what will this do to the NZ housing market" or words to that effect.. no date for when showing.. just said "coming soon".. a must-see methinks.. also mentions that there are 5million Kiwi's.. of which 4million live in NZ.. and what will happen when THEY also decide to return home...

If I see a broadcast date I'll update....

[upandrunning]

25k to northern rock, still speechless but worth it for the beach outside our door and the fact I see my husband now and he is not miserable from his 5 hour daily commute(now 15mins!)

[wayne]

Luckily we do not have a redemtion fee hanging over us, but our house has been on th market for 2 months now and we are getting impatient to go ,the nice man at the bank has offered us a £25000 home improvement loan on our existing mortgage (£34,000). we are thinking of using that cash to get outand started in NZ leaving enough money in our Uk bank to pay the mortgage for say 6-8 months and leaving the house sale in the hands of family and solicitors.
The house is expected to fetch £175-180.000 so more than enough to pay off the vultures and have a good deposit on an NZ house.
Has anyone else tried this route ???

[NW2NZ]

Hi Wayne,

Just a note to say that if you do leave your house, remember to advise your insurance company. Buried in the smallprint, it usually says that the cover is only available provided the property is not left unoccupied for more than 30 days. Look out for squatters too! :eek

My house has been on the market since last MAY and despite a huge reduction, there's still no sign of a buyer. I'm itching to get to NZ but I wouldn't contemplate leaving my primary asset behind. I'd be worried sick about what was happening to my property so far away.

Proceed with caution :nice1

[leslie]

moorf

£12.5 grand. ouch. now i'm awake...