Overpayment of mortgage

[Madra]

I requested to overpay my mortgage recently and specically added that I wanted the overpayment to be used to reduce the capital. I got a letter back stating they would do the overpayment but they did not specify that they would remove the payment from the principle. Can someone give me the exact wording (banking term) for this so I can explain this to them again and also can I insist they send me out a statement to show the effect of the overpayment ?

 

[jhegarty]

I requested to overpay my mortgage recently and specically added that I wanted the overpayment to be used to reduce the capital. I got a letter back stating they would do the overpayment but they did not specify that they would remove the payment from the principle. Can someone give me the exact wording (banking term) for this so I can explain this to them again and also can I insist they send me out a statement to show the effect of the overpayment ?

as long as your interest stays the same (which it would) i don't see where else the money would go...

 

[dam099]

as long as your interest stays the same (which it would) i don't see where else the money would go...

I think I've seen mention in previous posts that it may in some cases go to some sort of side account and be held in the event of missed payments etc. hence the need to specify your intention.

 

[shoegal]

Hi Madra, yes, I think you need to be careful about this. I can't give you wording but I recently took out a mortgage and the lender impressed upon me the need to put any kind of requests like this in writing. Otherwise the money will just stack up in your account and not actually reduce the capital. Presumably you should get something in writing back, or at least check your statements carefully. There are other posts on this subject.

 

[ClubMan]

I requested to overpay my mortgage recently and specically added that I wanted the overpayment to be used to reduce the capital. I got a letter back stating they would do the overpayment but they did not specify that they would remove the payment from the principle. Can someone give me the exact wording (banking term) for this so I can explain this to them again and also can I insist they send me out a statement to show the effect of the overpayment ?

Write to them informing them that any overpayment is intended as a capital repayment and not to be stored as a credit on your mortgage account. Make sure that they acknowledge this and deal with any overpayments as capital repayments.