Clearing a Mortgage

I'm considering moving house and will also be moving mortgage providers at the same time. I am currently on a variable rate.
I am effectively going to be clearing my mortgage with my existing provider and opening a new mortgage with another bank. Is there anything I need to be aware of, any extra costs for doing this?
Is it just a matter of paying off the balance on the capital or is there more to it?

Any advice would be appreciated.

Ask your current mortgage provider for redemption figures. This is what it will cost you to discharge the mortgage entirely and recover your title deeds.

As it seems to take forever for banks to seal a paid off mortgage, you are probably better off asking your solicitor to firstly take up the Deeds from your lender and then redeem the mortgage.

If you are discharging the mortgage from the sale proceeds, your solicitor will not be able to part with the deeds until s/he has sufficient funds to discharge the outstanding mortgage.

mf

Thanks mf

I am waiting for bank to come back with redemption figure but am preparing myself in case it's more than just the outstanding capital amount. Apart from an administration fee which they will probably charge, should it be more less whats outstanding on capital?

Yes, plus any accrued interest.

mf

By accrued interest, do you mean the current months interest up to the date when you payy off the mortgage in full?

Boe, you should also be aware of the mortgage life insurance issue.

If you are moving directly from your current house to your new house, you will probably not be able to use your current life insurance for the new mortgage.
The new mortgage will not be available for drawdown until life insurance is in place and the current life policy will not be released in time.

henry said:

If you are moving directly from your current house to your new house, you will probably not be able to use your current life assurance for the new mortgage.

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This really should only apply if the new mortgage is for a higher amount than the current life policy. If the new mortgage is for a lesser amount, your old lender can release their assignment and your new lender will then be able to take a new assignment on the current life policy. You will need to be proactive in this to avoid time delays.

If your new mortgage is for an amount higher than your current life policy, it may be possible to increase your current policy depending on the type of policy you have. Its always worth enquiring as amending an existing policy (again depending on the type of policy) may mean you can avoid additional medicals etc.

Its also worth getting quotes for a new policy and comparing them against quotes for the cost of increasing an existing policy.

But as Henry pointed out, this will have to be done quickly to avoid delays when drawing down your new mortgage.

Thanks for the feedback guys, hadn't even thought of the life insurance