Finalising Mortgage

[jw47]

My daughter's mortgage ends next May and we have told her to pay it off now as she has savings to do this. However she seems to think she needs to keep a small amount owing say £50 Is this correct Any advice would be appreciated

[ubasses]

Historically small balances were left on mortgages so that the Lender would store the Deeds for free. Since records have become electronic this has become unneccessary unless the property is unegistered.

[GlenB]

At one time it was common to leave a nominal balance outstanding on a mortgage so that if at a later date, the mortgagor (the borrower) wished to raise another loan on that same property, it was much cheaper in terms of legal costs to complete a "Further Charge" rather than a new Mortgage. I don't know if this is still current practice.

[Buenchico]

I'd certainly pay the mortgage off a.s.a.p.

However here are two links, to reputable sources of information, that might help your daughter to decide:
https://hoa.org.uk/advice/guides-for-homeowners/i-am-managing-2/pay-off-my-mortgage/

https://www.moneyhelper.org.uk/en/homes/buying-a-home/should-you-pay-off-your-mortgage-early#

NB (1): I strongly recommend that your daughter to ensure that she's got proof that she's paid the mortgage off. The Woolwich Building Society manage to mislay my final payment, of around £35k, and tried to repossess my house!

NB (2): Once the mortgage has been paid off, I suggest that your daughter should check the Land Registry's website to check whether or not the charge against the property has been lifted. About a decade after I got the Woolwich Building Society to accept that I'd paid off my mortgage, I tried to sell part of my garden to a neighbour, only to be told by a solicitor that I couldn't because there was still a charge registered against the property! (As the Woolwich Building Society no longer existed by that time, I had quite a struggle to get that error sorted out!)