Redeeming your mortgage

You may want to pay off your mortgage before the end of your term to sell your investment property, or remortgage to a better deal elsewhere. Or you may have some money available and simply want to be mortgage free sooner.

Paying off your loan early in this way is called 'redeeming' your mortgage.

How to redeem your mortgage

The first thing to do is contact us to request a redemption statement, which we will then send out to you. This statement will tell you exactly how much you owe on your mortgage at a given date, including interest and any fees that are payable.

If you have an Interest Only mortgage and are using a repayment vehicle such as an endowment or other investment, you need a current valuation to ensure the expected value is enough to cover the amount you owe on your mortgage. If the value of any repayment vehicle is less than the amount you owe on your mortgage, then you are responsible for covering this 'shortfall' from other funds.

The same is true if you are selling your property and using the sales proceeds to pay off the mortgage.

Fees and other costs

You may have to pay a redemption fee, which covers the maintenance and general administration of your mortgage during its term. This fee is non-refundable and is added to the final amount that you owe us.

You may be liable to pay an Early Repayment Charge (ERC) when you redeem your mortgage. This is usually a percentage of the amount being repaid and will be added to the final amount that you owe us. However, we are currently waiving all ERCs until further notice, so you won't have to pay this fee at present, even if it would usually have applied.

You can find details of any fees payable on your original mortgage offer. If you no longer have this document, you can contact us to find out more.

Please note: if you have a NRAM Commercial mortgage, please contact us, as additional costs or fees may apply.

Making your payment

You can make a final redemption payment to NRAM by using Telegraphic transfer, or by sending a cheque.

Telegraphic transfer:
Please use the following NRAM banking details.  You must also ensure that you quote your mortgage account number.

*If you have a commercial mortgage please use the following NRAM banking details. You must also ensure that you quote your mortgage account number.

Natwest Bank PLC
Sort code: 51-70-19
Account number:  80093027

Cheques should be made payable to NRAM and must quote your mortgage account number. The address for your cheque is:

NRAM Mortgage Operations
PO Box 625

If you have a commercial mortgage please send your cheque to:

NRAM Commercial Lending
North of England House
1 Grayling House
Doxford International Business Park

Other important information

There are other factors to consider that may be relevant, depending on your specific situation. Please contact us to discuss the redemption process if you need any guidance or support.

If your property is worth less than the mortgage

If you are in negative equity, you will still be legally responsible for the full amount of the mortgage that is outstanding. If this is the case, contact us before you proceed, so that we can discuss how we will manage your shortfall.

If your mortgage account is currently 'suspended'

This means you are no longer making any monthly payments but have a balance outstanding. We still hold a charge over your property and interest is being charged on the remaining balance. Over several years this balance could grow as interest is added. You can find out if your mortgage is suspended by referring to your most recent mortgage statement.

If you pay off this balance you become mortgage free. We will release the charge over your property and send you your title deeds and ensure that you are not accruing further interest.

Contact us to find out more information about paying off your suspended mortgage.

Paying off your mortgage in the future

You can make it easier to pay off your mortgage in the future by taking action now.

If you have an Interest Only mortgage, you should also ensure that you have a suitable investment vehicle in place and should check that this is on track to generate sufficient funds to repay your mortgage at the end of your term. You may need to consider increasing your payments if there is likely to be a shortfall.

Alternatively, you may want to switch all, or part, of your mortgage to Repayment. This will allow you to start paying off the loan balance gradually each month, reducing the amount that you owe when your mortgage term ends.

Finally, you could start making overpayments on your mortgage, which can dramatically reduce both the amount you owe and the interest that you are charged over the term of your loan.

Please call us to discuss any of these options.