Can I get a discount for early redemption?

by Readers Question

8:58 AM, 2nd November 2020
About a month ago

Can I get a discount for early redemption?

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Can I get a discount for early redemption?

I have some decent mortgages with CCL, Rosinca and others (1.5% above base rate) and have enough properties to fill my time and needs.

I now have the ability to repay all the mortgages (they have between 5 and 10 years remaining) and wonder if anyone has experience of gaining a discount in the settlement figure for early repayment as it moves the low margin deal off their books.

I have never missed a payment and would be seen as low risk of default.

Many thanks

Barry


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Comments

Ian Narbeth

10:17 AM, 2nd November 2020
About a month ago

Barry
It all depends. If the lender hedged the loan then it may even cost the lender to unwind the position. 1 1/2% over base rate is (currently) very attractive but if rates went up, as everyone thought they would not so long ago, things would be different.

That said there is no harm in asking.

Smartermind

14:05 PM, 2nd November 2020
About a month ago

They probably will penalise you for early redemption rather than offering any discounts, but that depends on the terms and conditions of the mortgage.

Loyalty counts for nothing, so the fact that you haven't missed a payment won't make any difference they will say that after all all you have done is stuck to the terms of the contract. As you are considering repaying the mortgages being "a low risk of default" is irrelevant.

If you had been in default and accumulated a debt, then things would have been a little different and they may have agreed to a discount for early partial settlement.

As Narbeth suggests, you can always ask, but they will probably just send you a straight forward redemption quote.


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Latest tier restrictions are a pretty blatant attack on less wealthy areas of the country

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