Not much time for frugality this week, as I'm actively being frugal by working on a Friday! Clients of mine have a staff shortage in their office today, and as a result asked me very nicely if I could consider doing an additional day for them - well of course I could! It does seem odd, these days, to be working on what is usually my day off, but that's an extra days earnings that can whizz off to the mortgage overpayments in due course.
Talking of mortgage overpayments - if you have an old Northern Rock Mortgage that has now been taken over by Virgin Money - beware. Without fail, whenever I have called them previously to make a lump-sum overpayment, I've always been asked whether I want to use the extra money to reduce the future monthly payments, or to reduce the term. Naturally we've always confirmed that we want to reduce the term, as that is after all the whole point of throwing the extra money at the thing! Last time though, after making an extra payment, we received a letter confirming that our "new" monthly payment was £xxx - over £100 per month LESS than what we're meant to be paying. Now, fellow NR mortgage people will know that their products mostly have an overpayment limit of 10% of the outstsanding balance in each financial year - so by reducing the monthly payment, Virgin have effectively put us into a position where, this year, we will now go over our allowance, and will get charged for the privilege! When I questioned this with them on the phone, I was told that it was a "mistake" that this had never been done in the past - presumably their question asked numerous times before about reducing the term was also a "mistake"?!
It won't surprise any of you in the least to know that we intend to take this further with them - MrEH is composing a letter as we speak - but I thought it worthy of mention as Virgin seem to have picked up a good amount of mortgage business over the past 12 months or so, and I can imagine a large number of people being affected. Had we not made that last lump-sum overpayment, we would never have known that we were set to go over our limits this year, so how many others must there be out there quietly making a standard monthly OP who have no idea that their provider is taking it upon themselves to change their terms?