Switching mortgage scam????

Kashkai

I've just moved my mortgage from First Active to Halifax. I received a statement from Halifax on Friday stating that it cost €261,000 to clear the mortgage with First Active. However, I checked my most recent statement from First Active dated last March and it stated that I owed €259,500 on the mortgage. Now as I've made 4 more payments of €1500 a month (capital and interest), I would have thought that I owed apprx €256,000 on the mortgage. So does anyone know why I ended up paying over €261k to clear a mortgage that should have been about €5k less than that sum? BTW, Halifax didn't charge any legal fees for switching the mortgage.

goz83

if it was a fixed rather than variable rate mortgage I guess there may have been a penalty for early payment You could ask first active what happened.

kirving

It's probably interest that's been charged that brings it up to 261k. You should get a statement from First Active showing your March balance less the payments you made for the last few months plus interest accruing from whenever it(interest) was charged last. I would think if there was a penalty for breaking out of a fixed rate it would be a hell of a lot more. Either way you will get a statement and it should be self explanatory. Bank of Ireland wanted 6k from me to break out of a 10 year fixed rate when I owed them less than 30k. Needless to say I held on grimly until the term was over and left them then. At the time I was paying a rate of 10% and the world and his mother was paying less then 5%.

Saruman

Even if its a variable rate, usually there is a fee to pay off early. Im with ICS and in their terms and conditions they even have a formula that looks like something out of a physics book to work it out

ball ox

the fee for paying it off early is only around 60 quid.
Balance + Interest Accrued + Breakage cost = total to redeem so its one of those variables that is adding to the cost, most likely the interest accrued if your not on a fixed rate.

Kashkai

After a lot of phone calls, it turns out that First Active added 2 extra loan repayments to the redemption figure they provided Halifax on the basis that they wanted to ensure that they were reimbursed for this months and next months mortgage repayment in the event I cancelled my direct debit with them prior to the mortgage I had with them being paid off. They have promised to refund this money once the cheque from Halifax clears, though judging by their crap customer service (which is the reason I left them after 21 years with them) it will take a lot more phone calls, and threats of going to the financial regulator before they refund my money.

I had a bad experience with them last year when they took 2 mortgage repayments off me in error one month and I had to apply to them in writing for my money back - even though it was their mistake. They never even apoligised for the fact that they took the extra €1,500 off me and left us short of money for the month.