If you consciously degidge early in the term, like say five years into a thirty year mortgage, not regidging somewhere else but just paying it off from accumulated netnet, and you pay the early repayment penalty (half or one percent I think), is it generally considered that this will make it more (or less?) difficult to take out a mortgage on the purchase of a different property a few years later with (a) the same lender or (b) a different lender?
Search RollOnFriday
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6/10
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Quality humblebrag.
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Why would you pay the early repayment?
Just wait for fixed period to expire then pay off in full
It's never stopped me getting a gidge
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If you live in the UK, the bulk of your income come from employment and have a decent credit score it won't make any sort of difference that is worth worrying about.
If you live abroad and/or have non-standard income sources and/or credit problems it may be a different analysis. Not so much because of the repayment having an impact but because if the market tightens you may struggle to raise new debt.
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Thanks for all the responses. Genuine question. No fixed period so repayment charge the same for whole term.
Situation is I have or will have a sum of money in the bank which is equal to the outstanding debt on prop1 but is or was intended for a deposit on prop2. If I decide that I don't want to buy prop2 until two years from now, it makes sense to pay of gidge1 and save 2 years of interest. Then get one gidge on prop2 instead of the planned 2 gidges on 2 properties. But not if the bank will say we don't like him he pays off too early in which case better to keep the debt in place to keep them happy so they will lend gidge2.
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Depending on what your interest rate is, surely you would make more money from the savings than paying interest on the mortgage
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(Out and out brag)
I am paying my London mortgage off in February, they made me take out a 35 year term, I will have done it in seven
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MrA, some high street lenders may have a view. But the specialist lenders will take a narrative view (Arbuthnott, Butterfield, Handelsbanken, Hampden, Shawbrook, Aldermore, etc.).
I like knowing that my home is mine. Even when mortgaged, had a small place which was the price of a 2nd hand car (let alone a mid ranking watch!) and which could never be taken away. Was very important for my mental health.
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Bravissima, Feebs.
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Deemus, Sorry - what is a 'narrative view' in this context?
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Bravissimo shurely
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Short answer is no. Lenders want to lend. That said, I once paid off a gidge in 7 months after agreeing a 12-year term. I later learned that HSBC wouldn't entertain a repayment period of anything under 5 years. Pity for them there was no ERP. And of course deliberate on my part.
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Mr A, they are more interested in the person and the story. Not just a pure call centre algorithm.
FWIW, Hampden were brilliant for me and I recall Bailey has good things to say about Handelsbanken.
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