Clearing Mortgage

M

Massey

Registered User
Messages
26
Hi,

I'm planing to sell my house and pay off the mortgage. Housei s worth 400k, mortgage is 200k. I'm on a variable rate. If I sell and get the value above, will I stand to clear 200K (approx. after fees, etc) given that it is my primary residence or do the bank have penalties for clearing early? Mortgage has another 20 years left on it. Thanks.
 
AFAIK you wont have any penalties to pay as you are on a variable and its your PPR so no Capital gains tax.
 
Tracker should be the same. The only reason I can see for penalties is if you are on a fixed rate. In this case you would be 'breaking the agreement', so to speak.
 
No penalty with either a variable or tracker mortgage. Penalty (if it arises) only occurs with a fixed rate mortgage.

BM
 
For what it's worth there is a small charge to remove the lender's interest from the mortgage deeds when the mortgage is cleared. This applies regardless of the type of mortgage held. See this thread:

Deeds release fee
 
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