Can I exit my mortgage early without paying exit fees?

Posted on 17 March 2008

I have just bought my first property. I took a mortgage with RBS. Our monthly payments are very high - we have a fixed rate of 6.35% for 5 yrs. We are struggling with repayments, can we exit this mortgage without having to pay the exit fees as it states on the documents?

Hi,

No I'm afraid you can't get out of the agreement once arranged, that's why you're given so much detailed information before you sign up. 

It is very rare that someone would be struggling with the payments on a fixed rate, especially this early in the mortgage. Your affordability would have been carefully scrutinised before you applied, so I can only imagine that your household income has changed.

Speak to your lender first, as they are obliged to offer helpful solutions.  It may be that they can allow you to extend the term of your mortgage, or go interest-only temporarily.  You could also consider asking the lender for permission to let the property, so that you can move out and receive rent for it.

Check what insurances you took out with the mortgage.  If you have been made redundant, check with your lender as you may have Accident-Sickness-Unemployment cover, (ASU or MPPI).  Also contact your card providers and loan providers about it too.  If you have become long-term-ill and unable to work, a Critical Illness Policy or Income Protection plan would cover it.

Category: First-time buyer, Lower mortgage payments

 

Answers provided in response to Ask Bea are based on the information provided and do not constitute advice under the Financial Services & Markets Act. They reflect the personal views of the authors and do not neccessarily represent the views, positions, strategies or opinions of Charcol Limited. All comments are made in good faith, and neither Charcol Limited nor Bea will accept liability for them.

We recommend you seek professional advice with regard to any of these topics where appropriate.

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