making extra mortgage payments off capital

Hi,

Apologies if this is covered elsewhere - I did look around!

If we'd like to make regular extra payments off the capital of our mortgage what's the most convenient method?

The mortgage is with Ulster Bank for info. Would like to make either regular extra payments eg by standing order, or frequent ad hoc payments, say e1000-2000 two-monthly.

Does anyone do this, and do you have a standing order or do you send off cheques with a letter, or how's it done?

Didn't get much of a response from ub mortgages, nor broker, nor bank..would be grateful for any info!

thanks
dj

Don't just make unexpected payments to the mortgage account without discussing it with the lender first. There is no guarantee that these will be immediately deducted from the outstanding capital balance if you do this. You should talk to the lender, agree that you are going to make certain lump sum and/or regular capital "over" payments and then make them in whatever way they allow. Get agreement that these are accelerated capital repayments in writing.

I agree with Clubman. I was making overpayments to my mortage for a couple of months without telling the bank or filling out a form. I asked afterwards and they said the money was just sitting in the account and not doing anything. I was annoyed to say the least but now it's fine. Just tell them what you are doing and fill out any forms they tell you too.

Niallers said:

I agree with Clubman. I was making overpayments to my mortage for a couple of months without telling the bank or filling out a form. I asked afterwards and they said the money was just sitting in the account and not doing anything. I was annoyed to say the least but now it's fine. Just tell them what you are doing and fill out any forms they tell you too.

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thanks guys that's very useful..

should I contact my local UB branch rather than UB mortgages, the georges quay crowd?

I went through the people I took the mortgage out with( TSB DIRECT). They sent the form in the post. Your local branch will have forms too.

Well worth doing if you can afford to. Especially if you are in the first 8 years of your mortgage. You should knock a few years off your mortgage.

Saying that, if you have high credit card debt I'd concentrate on that first.

Check they don;t have a charge....BofS charge €95 every time you want to pay a lump sum and/or change the amount of the monthly payments, so if we are doing this we wait until we have a decent amount to pay & time it to co-incide with us being able to increase payment....not sure about UB

daijenks said:

thanks guys that's very useful..

should I contact my local UB branch rather than UB mortgages, the georges quay crowd?

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Is there a specific branch mentioned on your statement? If so that is who I would deal with.

Good point above about checking in case there are charges or any limits on the minimum amount of capital repayment that they are willing to handle.

You can estimate the potential savings attributable to an accelerated capital repayment strategy using Karl Jeacle's mortgage calculator:

http://www.jeacle.ie/mortgage/ie/

If the mortgage amount takes a significant drop then you may also be able to arrange lower and cheaper mortgage protection life assurance to save another few bob.

I've made a couple of lump sum payments through my nearest branch (which isn't the branch I have the mortgage with) and then I wrote to the mortgage branch asking to increase my monthly payments and have the excess set against the capital. They then increased by direct debit accordingly.

sam_h I was told by my broker that bank of scotland do not charge for making lump sum payments, that there was just a minimum amount of 1000euro, are you on a tracker rate?

i did this last year with Ulster bank, no issues, put it in writing to them and they will adjust your monthly repayment, better to get used to something regular than irregular payments,

go to bankrate.com for calculators, great site, extra 500 a month knocked a shopping 10 yrs off mortgage

gally74 said:

i did this last year with Ulster bank, no issues, put it in writing to them and they will adjust your monthly repayment, better to get used to something regular than irregular payments,

go to bankrate.com for calculators, great site, extra 500 a month knocked a shopping 10 yrs off mortgage

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thanks gally74 - was it straightforward to ensure that the extra was deducted from the capital alone and not from the outstanding (capital + interest) ?

and the more the balance comes down the lower the LTV becomes which in turn may help with a lower rate...