Paying off a mortgage

[ScumOfTheRoad]

I am still working but paying off a mortgage. I have a long term fixed interest rate which is due to end in two years.
I can pay off 10% without penalty, which I intend to do. At the end of the mortgage I thankfully might be in a position to pay it off in a lump sum. However there are penalties for early repayment. Does anyone know what the situation is at the end of a mortgage?

[ElyDave]

Check the terms, they can be specific, but in my experience after the fixed, or offer period and you are back on variable rate, the penalties disappear

[PaulF]

Yes as Dave says check your agreement but in my experience there are only penalties at the end of the fixed period.

[rogerzilla]

There's usually a redemption or "sealing" fee, which should be less than £100.

[rafletcher]

You’ll also get the deeds. Some folk leave £100 on the mortgage so the secure storage of deed remains with the lender.

[CrinklyLion]

You’ll also get the deeds. Some folk leave £100 on the mortgage so the secure storage of deed remains with the lender.

The deeds are held electronically in most cases now.

[Canardly]

Some people leave some small debt on a mortgage to term in order to maintain a healthy credit history for say, when they become economically inactive (retired).

[Wowbagger]

I’m retired but definitely economically active: my savings are dwindling rapidly!

[mllePB]

You’ll also get the deeds. Some folk leave £100 on the mortgage so the secure storage of deed remains with the lender.

The deeds are held electronically in most cases now.

HM Land Registry look after the lot electronically. Anyone can get an electronic copy for £3 (or ££ more if using a scammer middleman site).

[ian]

There are some benefits to keeping a small amount active, mainly if you plan to borrow again, otherwise you're starting afresh with an entirely new loan and have to leap all the new borrower hurdles. Even though we could have paid ours off, we keep a nominal loan going for this reason as we're vaguely thinking of moving at some point. As said, it's also good for your credit history.

[Mrs Pingu]

When we paid off our last Nationwide mortage they left £1 on it without being asked to.

[robgul]

As Roger says there is an admin fee when the mortgage is paid off . . .  the ability to pay off an amount without penalty is good, but it's also worth looking at the penalty should you want (be able) to pay off more . . . . 

We sold one of our BTL properties (and redeemed the mortgage, obviously) and with some of the funds released paid off more than 10% on the other BTL property morgage - the amount was pretty low and made sense to take the hit against the cost of borrowing etc.  [That may be case specific for us, but it's worth working out the sums]

[hellymedic]

I decided on a flexible mortgage.
Chucked any spare cash at it and got shot of it as soon as I could.
No redemption fee.
I don't do debt and was very relieved when it was behind me.
I am lucky...

[ScumOfTheRoad]

Thankyou all for responses.

[MikeFromLFE]

I decided on a flexible mortgage.
Chucked any spare cash at it and got shot of it as soon as I could.
No redemption fee.
I don't do debt and was very relieved when it was behind me.
I am lucky...

That was my approach. I had a 'retirement plan' (that didn't work out as expected) that included overpaying the mortgage to pay it off before I retired.
Again, I was fortunate in being able to do that. It was a huge weight off our shoulders.

[rogerzilla]

I had 8 months left in 2014 but had to start again (albeit with a 40% deposit) at the age of 44.  Not ideal, but I do have the money to pay it off sitting in the DC pension plan I use as tax-free savings.  There's no point paying off the mortgage a few years early to save 4% interest, from income taxed at 43.25%!

[ian]

We might be mostly debt-free now – looks at house prices – we'll be borrowing more if we move again unless I find a spare million down the back of the sofa or a Russian oligarch needs me to launder a few sanction stains out of their cash. We've never tried hard to clear it, other than the 10% over-payment each year. As Roger says, if you can afford the monthly payment, at the current interest rates (and more so with current climbing inflation), there are better things you can do with your money. We just locked in our remaining debt for five years at about 2% fixed. Inflation is probably paying off more than we are.