Early Repayment Charges (ERCs) and redemption expenses will now be shown on the redemption statement, unless, as a result of a mortgage policy (e.g. when a customer is in the last 10 years of their mortgage term), they aren't due.
Please read below a reminder of our porting policy.
Supported porting application types
ERCs and redemption expenses aren't payable, or are refundable, in these examples:
- Simultaneous porting (same day) - if your client is transferring their current mortgage product onto their new property, they won't have to pay any applicable ERCs or redemption expenses which are shown on the redemption statement, so long as:
The sale and purchase complete on the same day and the entire remaining balance of the existing mortgage product is transferred. When the new mortgage is of a lesser value than the existing mortgage, a partial ERC may be due.
- Split porting (different days) - where a porting application has started, a mortgage offer has been produced, and the existing mortgage account is redeemed. The new mortgage completes on a future date, within the 6 month offer period, maintaining their relationship with Nationwide.
ERCs and/or redemption expenses are expected to be paid, however, they'll be refunded upon completion of the onward port (if applicable). Nationwide won't release the charge on the property at the respective Land Registry until the full amount has been paid.
Unsupported porting application types
- Non-simultaneous porting (closed port) - where the existing mortgage account is redeemed, but there isn't a porting application in place, therefore breaking their relationship with Nationwide. The customer then returns to Nationwide within 6 months looking to port their previously closed account to their new property. Nationwide hasn't offered or supported these applications since April 2012.
Where the ERC isn't payable, the solicitor will need to account for the ERCs and redemption expenses from the sale, and deduct these before sending the payment through to us.