Mortgage is coming to an end... What do I need to do.

[Tom B]

I'm hoping some of the learned or experienced folks here can assist as I am constantly amazed by the breadth of knowledge.

I'm now into my final year of my mortgage.

The fixed rate deal ends in January at which time I'll have around 6 payment left (at current rates).

The plan is I might just pay it up at that point using savings and then erebuild the savings using what would have been mortgage payments.

AIUI I need to ask the mortgage company for a settlement sum and give them a date to calculate it to. I then pay it and the house is mine.

But, is it as simple as that?

Do I need to involve solicitors?

I seem to recall my dad getting deeds for his house when he paid his mortgage off and seems to recall he lodged the deeds with a bank or solicitor? Do I need to do that? of not what do I do with the deeds?

The mortgages will be paid off about 12years early I took life insurance alongside the mortgage. I've spoken to them and they say that once the mortgage is paid I can stop paying them. And the source a new life policy with a cash payout should i so wish. So that seems easy enough.


There is a slight fly in the ointment that the house is in my name only as when we bought Mrs B had dubious credit rating. Ideally I need to put the house in both our names - it only seems fair she's paid half the mortgage :-). How do I achieve that?

 

[Drago]

Paper deeds aren't such a problem. In olden days whoever physically held the deeds in their hand could claim title, but its all registered electronically now so they are more symbolic than essential.

 

[midlandsgrimpeur]

There is a school of thought that you leave on a nominal amount for a couple of reasons. Firstly it leaves you the option to borrow against your house more easily should you need to in future. Secondly it stops scammers from fraudulently selling your house as the lender would always be notified. You can register for alerts with the Land Registry to counter this I believe.

As far as I am aware you don't require a solicitor, your lender will inform the LR that the property has been discharged and the deeds will be stored electronically in your name. I am sure your lender will advise you on all of this though.

 

[midlife]

Ask the mortgage provider for a redemption certificate. That says how much you owe. Pay it off and the house is yours.

The deeds are electronic so no paper changes hands.

I did it all on my natwest phone app.

 

[Pblakeney]

I put what was my mortgage payments into a pension. Or rather, I kept my money and got my employer to do it.
Tax efficient and helped me retire early. This was my experience, not financial advice.

 

[Seevio]

From memory I just went into the branch and said how much do I have to pay now to clear it.

Bear in mind that a mortgage is generally one of the cheaper debts so pay off things like credits cards or other loans first if you have them.

 

[DCLane]

+1 to @midlife 's approach.

My Christmas present in 2020 was to pay off the mortgage, with about a year's payments left on it at the time having been over-paying for several years.

I phoned the mortgage provider and asked for a total to pay it off in full on a specified date. They provided this, including an end fee, which we paid in full.

Deeds are all electronic these days, so no needing to leave a bit on the balance.

 

[richardfm]

Re. putting the property in your wife's name as well as yours, read this
https://www.gov.uk/joint-property-ownership
I think you will need a solicitor.

 

[PaulSB]

We paid off our mortgage about ten years early. I can't recall the process. I would offer the following:

• be cautious over ending your life policy. It may be a better deal than you can purchase today
• I put my mortgage payments into my pension pot. This helped us retire financially secure at 60 and 62
• consider the type of property ownership that's appropriate to your situation. There are two basic choices:
• joint tenants in which each party owns the property equally as a single unit
• tenants in common in which each party owns a defined share, for couples this is usually 50/50
• the type of ownership that's most appropriate depends on stage of life, wills, inheritance, children from a previous relationship and other factors. A solicitor will advise on the different options.
• as an example my wife and I are tenants in common. On first death the deceased's share passes into a trust fund. This is a choice we made to ensure provision for one son who needs lifetime care. It can, to an extent, protect the survivor from paying for social care in later life. Basically if the survivor owns half the property only that half can be assessed as part of the individual's assets.
• one should be careful with such an arrangement as local authorities can and do contest the arrangements if these are viewed as an attempt to avoid social care charges.
• with joint tenants ownership automatically passes to the survivor

 

[biggs682]

What's a mortgage

 

[Drago]

What's a mortgage

I remember them. The only 'loan' I ever took.

 

[T4tomo]

The fixed rate deal ends in January at which time I'll have around 6 payment left (at current rates).

The plan is I might just pay it up at that point using savings and the rebuild the savings using what would have been mortgage payments.

yes as @DCLane hints you need to be specific on the date, you possibly can't redeem without penalty whilst in your fixed rate period (but you might be able to as some products allow overpayment) but on the day it ends you can settle it up in full.

If you have paid off your mortgage and are an age where you can both access pension pots etc, ask yourself do you still need life cover? If you're still working you're likely to have death in service benefit anyway.

 

[Tom B]

Thanks to everyone who responded to this.
We have no other debt to speak of - we have credit cards but we pay them off and largely use them to get the benefits of the consumer credit act - I think i screwed up bill date and ended up giving barclaycard a total of £1.13 last year
We're the save and buy types rather than the buy and pay -

To that end the Mortgage IS the most expensive debt we have

Paper deeds aren't such a problem. In olden days whoever physically held the deeds in their hand could claim title, but its all registered electronically now so they are more symbolic than essential.

Didn't know that, many thanks.

I put what was my mortgage payments into a pension. Or rather, I kept my money and got my employer to do it.
Tax efficient and helped me retire early. This was my experience, not financial advice.

That's sort of the plan, I already have a couple of pensions and ideally don't intend on working much past 60 before becoming self unemployed.

Plan is that We want a new kitchen and the facias and soffits need replacing (both have needed doing since we bought the house in 2013), so we will keep paying what we pay for the mortgage into the joint account and use that money to pay for those jobs. I quite fancy getting the roof stripped, re"felted" (it must be one of the last built with bitumen felt) and getting it solar ready.

We've cut our cloth a fair bit to pay the mortgage off in 13yrs so it'll be nice to get a few thing sorted.

Once that is done we'll up the AVCs.

We paid off our mortgage about ten years early. I can't recall the process. I would offer the following:

• be cautious over ending your life policy. It may be a better deal than you can purchase today
• I put my mortgage payments into my pension pot. This helped us retire financially secure at 60 and 62
• consider the type of property ownership that's appropriate to your situation. There are two basic choices:
• joint tenants in which each party owns the property equally as a single unit
• tenants in common in which each party owns a defined share, for couples this is usually 50/50
• the type of ownership that's most appropriate depends on stage of life, wills, inheritance, children from a previous relationship and other factors. A solicitor will advise on the different options.
• as an example my wife and I are tenants in common. On first death the deceased's share passes into a trust fund. This is a choice we made to ensure provision for one son who needs lifetime care. It can, to an extent, protect the survivor from paying for social care in later life. Basically if the survivor owns half the property only that half can be assessed as part of the individual's assets.
• one should be careful with such an arrangement as local authorities can and do contest the arrangements if these are viewed as an attempt to avoid social care charges.
• with joint tenants ownership automatically passes to the survivor

The life policy is one of them that just pays the mortgage off, so when the mortgage ends, the policy ends.

The joint ownership type needs a needs a bit of consideration - thankyou.

I presume you can chop and change it at a later date?

yes as @DCLane hints you need to be specific on the date, you possibly can't redeem without penalty whilst in your fixed rate period (but you might be able to as some products allow overpayment) but on the day it ends you can settle it up in full.

If you have paid off your mortgage and are an age where you can both access pension pots etc, ask yourself do you still need life cover? If you're still working you're likely to have death in service benefit anyway.

Our fixed period ends a couple of months Feb 27) before before the mortgage is due to be paid off at the current rate (June). While there is an option to end it sooner and a modest fee, it just doesn't make sense at this time. Depending on what the SVR is in Feb, that's the point i might just pay it with savings when there is no fee.

We are early 40s so a few years to go until pension is accessible, plan is to look at a life policy to take us to 60ish when we'd be looking to retire anyway. It would be a modest plan to basically fund the kids through uni should the worst happen. Its not a given, more something we can consider.

That reminds me, i need to give my pension a coat of looking at - 1% fee seems expensive to me!!

 

[Pat "5mph"]

Here in Scotland we have to pay a solicitor to release the deeds from the mortgage provider ... over £400 it cost me
I suppose, less to do for my executors, maybe by the time I die this will cost £ 1,000
I also had to pay £160 early mortgage pay off fee, because it was a capital and interest.... meh!

 

[Oldhippy]

Sell the house, get a hand built tourer and travel the world at your leisure.