Understand which fees and charges you may need to pay.
YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE.
If you're buying a home or taking out a mortgage to raise capital, we will usually arrange for a surveyor to prepare a Valuation Report on the property for us.
Our valuation (Level 1) is a very brief report on the property's condition and its market value based on a limited inspection of the readily visible and accessible parts. You will be sent a copy, but it's important to understand that the report is not a detailed survey - it is just for our purposes to help us assess if the property is adequate security for the money you want to borrow.
There is normally a fee for a Valuation Report which you will need to pay us when you apply for your mortgage (see table below).
We recommend that you arrange a more detailed report into the property's condition than the Valuation Report. We've outlined the other types of report available below:
Survey and Valuation (Level 2)
A Survey and Valuation report is for you and we don't receive a copy of the survey. It is produced in an easy-to-follow format and will give you guidance on defects and other issues that should help you in your decision to buy. There are set fees for a Survey and Valuation depending on the value of the property (see table below).
Building Survey and Valuation (Level 3)
This is an even more detailed report on the property, which can be tailored to fit your requirements. Again, the report is just for you - we don't receive a copy of the survey. If you choose a Building Survey and Valuation, you will have to agree the additional fee for the Building Survey with the surveyor. Because both a Survey and Valuation, and a Building Survey and Valuation are for you, the surveyor will send the appropriate terms of engagement direct to you for you to read, sign and return to them. Sometimes investigations reveal structural defects in the property. If that happens we may not release the mortgage money until the defects have been fixed. You may have to pay re-inspection fees if we decide that further inspections by our valuer are needed before all the mortgage money can be released.
If you are remortgaging to us, we will arrange a property assessment for our own purposes based on the information you give us, we may charge a fee for this. You must not rely on the fact that we may be prepared to make you a loan as any indication of the value of the property. You may want to get your own valuation advice.
Valuation & Survey- Residential Applications
Some of our mortgages carry a charge if you repay all or part of your mortgage in the early years or switch to a different mortgage - these are called early repayment charges.
How much can I repay without having to pay an early repayment charge?
If you want to pay off part of your mortgage or make overpayments where there is an early repayment charge, as a current concession you can repay up to 10% of your mortgage balance each year without having to pay the charge.
The 10% is calculated using the balance as at 1 January of the year in which you make the repayment.
If you repay up to 10% and then repay the remainder of the loan in full within six months, the early repayment charge will also be charged on the 10% you initially repaid.
The 10% overpayments limit is a concession and could be withdrawn on giving three months notice.
Where there is no early repayment charge period or it has expired you can repay the loan in full or in part whenever you want.
Moving home with your current mortgage deal
If you move home, you may be able to take the terms of your current mortgage deal with you. This could be so you:
Taking your current deal with you means that, when you repay the mortgage on your current home to move, you take out a new mortgage on your new home for at least the same amount.
In other words, any fixed rate or tracker would continue to apply for the remainder of the original deal period; and, if there's an early repayment charge on your mortgage, you won't have to pay it. The charge would still apply though if, after you'd moved, you subsequently repaid the mortgage (or more than 10% of it) while you were still benefiting from the fixed rate or tracker.
If there's a delay in your move
If there's a delay between repaying your current mortgage and taking out a new one on a new property, then you will have to pay any early repayment charge but in certain circumstances it may be refunded once your new mortgage starts.
If you need to borrow more
If you want to take your current deal with you when you move, but borrow more on top, you could apply to borrow extra on the basis of our other mortgage deals available at that time.
It's also important to note that our lending policy at that time will also apply, and this could be different from the policy that applied at the time of your most recent application.
In some cases - for example, where you want to borrow more in relation to your income than we are prepared to lend on standard terms - the additional borrowing will only be agreed if the whole of your new mortgage is on specific terms.
This may mean that you will be unable to transfer the terms of this mortgage as described above.
If you're borrowing less
If you move and want to take your mortgage deal with you, but your new mortgage is for a smaller amount, any early repayment charge that you have to pay will be based on the difference between the two mortgages.
If you're borrowing less and there's a delay between repaying the current mortgage and taking out the new one, the paragraph above - 'If there's a delay in your move' - applies, but the amount refunded will be calculated proportionately.
If your mortgage began before 1 November 2008, a different policy may apply, please call our Helpline on 0345 835 3380 for details.
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