If you’re planning to pay off your mortgage with The Mortgage Works (TMW), you’ll need to understand a key document called the Mortgage Redemption Statement.
This statement provides a complete breakdown of the amount you’ll need to pay to settle your mortgage balance in full. But what exactly does this statement contain, and how can you make sense of the technical terms often included in it?
In this comprehensive guide, we’ll explain everything you need to know about The Mortgage Works Redemption Statement.
From understanding key terms like redemption figure, outstanding balance, and early repayment charges (ERC) to walking you through the process of requesting the statement, this guide will provide you with the clarity you need to close your mortgage with confidence.
What Is a Mortgage Redemption Statement?
A mortgage redemption statement is a formal document provided by The Mortgage Works (TMW) that details the total amount you need to pay to settle your mortgage. It includes key financial information, such as:
- Redemption Figure: The total amount required to pay off the mortgage.
- Outstanding Mortgage Balance: The unpaid portion of the loan.
- Accrued Interest: Interest calculated on a daily basis from your last payment until the redemption date.
- Fees and Charges: Any administrative fees, mortgage exit fees, and Early Repayment Charges (ERC).
- Daily Interest Rate: The rate of interest applied each day in case of delays in payment.
This document is essential when you’re selling your property, switching lenders (remortgaging), or simply paying off your mortgage early. Without a redemption statement, you wouldn’t know the exact amount required to settle your mortgage, as fees and interest charges are subject to change daily.
Key Terms in The Mortgage Works Redemption Statement
To fully understand your Mortgage Works Redemption Statement, you’ll need to know the meaning of certain key terms. Let’s break them down.
Redemption Figure
The redemption figure is the most important figure on your redemption statement. It represents the total amount you must pay to settle your mortgage account. This figure is valid for a limited period (usually 30 days) and is calculated to a specific date. If you don’t pay it by the specified deadline, interest may be added, and you’ll need to request a new statement.
Key factors affecting the redemption figure include:
- Outstanding Balance: The remaining loan balance on your mortgage.
- Daily Interest: Interest that accrues daily until the settlement date.
- Fees and Charges: This includes any Early Repayment Charges and Mortgage Exit Fees.
Outstanding Mortgage Balance
The outstanding balance is the total amount still owed on your mortgage. While this is part of the redemption figure, it is not the entire amount. The outstanding balance only accounts for the principal amount owed and does not include additional charges like fees or daily interest.
If you request a redemption statement, the balance shown on the statement may be higher than what you see on your online mortgage account, as it includes daily interest and administrative fees.
Early Repayment Charge (ERC)
An Early Repayment Charge (ERC) is a fee charged when you pay off your mortgage before the end of a fixed-rate or discounted-rate period. The ERC is typically calculated as a percentage of the outstanding balance. The specific percentage and how it is applied will be outlined in your original mortgage agreement.
When does an ERC apply?
- If you pay off your mortgage early (before the fixed or discounted period ends).
- If you switch to another lender during the initial fixed-rate period.
You can find details of your ERC in your mortgage offer or redemption statement.
Mortgage Exit Fee
The mortgage exit fee (also known as a “redemption administration fee”) is charged when you close your mortgage. This fee is designed to cover the administrative costs associated with closing your account. It is usually a flat fee, not a percentage of the balance, and you can find it listed in The Mortgage Works’ tariff of charges.
Daily Interest Rate
The daily interest rate is the interest charged daily on your outstanding mortgage balance. If you delay paying the redemption figure past the specified deadline, the additional days will attract extra interest, which is calculated at the daily rate.
If you make a payment before the statement’s deadline, you can use the daily rate to adjust your outstanding balance and calculate your new total.
Title Deed Release
When you fully pay off your mortgage, the lender’s interest in your property is removed, and you are given full legal ownership of the title deed. The Mortgage Works will handle the process of releasing the title deed, which can take up to 20 working days.
How to Make a Redemption Payment?
Once you receive your Mortgage Redemption Statement from The Mortgage Works, the next step is to make the payment. To avoid delays or unexpected interest charges, it’s important to follow the payment process carefully.
Here’s a step-by-step guide on how to make your redemption payment:
Step 1: Review Your Redemption Statement
Before making any payment, carefully review the redemption statement. This document will specify:
- Redemption Figure: The total amount you need to pay.
- Deadline: The payment must be made before the expiry date to avoid additional charges.
- Daily Interest Rate: If you miss the deadline, you’ll be charged daily interest, so it’s important to pay on time.
Take note of the deadline date and the final amount payable. If you think you’ll need more time, you can request an updated redemption statement.
Step 2: Choose Your Payment Method
There are two primary ways to make your redemption payment:
- Bank Transfer (Faster Payments, CHAPS, or BACS): This is the fastest and most secure option.
- Standing Order or Direct Debit: If you have an active standing order, be aware that payments may take time to process, and the redemption figure may change if payments arrive late.
For the fastest results, it’s recommended to make the payment via Faster Payments or CHAPS. This ensures the payment reaches The Mortgage Works on the same day.
Step 3: Use the Correct Payment Details
To avoid any delays, make sure you use the correct bank details when making your payment. The payment details differ depending on the type of mortgage you have.
| Mortgage Type | Account Name | Sort Code | Account Number | Account Type |
| The Mortgage Works | The Mortgage Works UK PLC | 20 12 04 | 00028991 | Business |
| Derbyshire Home Loans Ltd | Derbyshire Home Loans Limited | 20 12 04 | 43695301 | Business |
| E-Mex Mortgages | E-Mex Home Funding Limited | 20 53 85 | 13797147 | Business |
Important Notes:
- Use your mortgage account number as the reference when making the payment.
- Double-check the bank account details and reference before confirming the transfer.
- If you enter incorrect payment details, your payment could be delayed or returned.
Step 4: Send Your Payment Before the Expiry Date
The redemption figure on your statement is only valid until the date specified. If payment is not made before this date, additional daily interest will be charged. This could create a “shortfall,” meaning the payment you send may be insufficient to fully close your account.
To avoid this, follow these tips:
- Make your payment at least one or two days before the deadline to allow for bank processing times.
- If using CHAPS or Faster Payments, the payment will usually be processed on the same day.
- Payments made via BACS or Standing Order can take up to 3-5 working days to process, so plan ahead.
Step 5: Confirm the Payment Has Been Received
Once your payment is sent, give it some time to process. Payments sent via CHAPS or Faster Payments should be received by The Mortgage Works on the same day. Payments via BACS may take up to 3-5 days.
Here’s what to expect once your payment is received:
- Account Closure: The Mortgage Works will close your mortgage account.
- Title Deed Release: They will release the title deed for your property.
- Closure Letter: You will receive a letter confirming that your account is closed.
The entire process, from payment receipt to title deed release, can take up to 20 working days.
How To Request a Mortgage Works Redemption Statement?
If you want to pay off your mortgage, you’ll need to request a redemption statement. Here’s how you can do it:
- Fill out the Redemption Statement Request Form on The Mortgage Works’ website.
- Check your contact details: Make sure your email is correct, as this is where the statement will be sent.
- Wait for up to 5 working days to receive your statement.
If you need to update your email, you’ll need to call The Mortgage Works at 0345 606 40 60 before submitting the request form.
Costs and Fees To Be Aware Of When Paying Off Your Mortgage
| Cost/Charge | Description |
| Early Repayment Charge (ERC) | A fee for paying off your mortgage early. |
| Redemption Administration Fee | The cost of closing your mortgage account. |
| Daily Interest | Interest charged daily for delayed payments. |
| Legal Fees | Additional legal costs if required to release the title deed. |
Tips for a Smooth Mortgage Redemption Process
- Request the redemption statement early: This gives you time to review it and avoid delays.
- Double-check your payment details: Ensure you input the correct account details for payment.
- Don’t cancel your standing order too early: Wait until your account is confirmed as closed.
- Be mindful of payment deadlines: Payments made after the statement expiry will attract daily interest.
Conclusion
The Mortgage Works Redemption Statement is an essential document when paying off your mortgage. It gives you a clear picture of the total amount owed, fees due, and the deadline for payment. Understanding key terms like the redemption figure, early repayment charges (ERC), and daily interest rate ensures you can settle your mortgage without any costly surprises.
If you’re unsure about any aspect of your statement, don’t hesitate to contact The Mortgage Works for clarification. This will ensure a smooth and stress-free mortgage redemption process.
FAQs About The Mortgage Works Redemption Statement
What is a redemption statement?
A document showing the total amount required to fully pay off a mortgage.
How do I request a redemption statement from The Mortgage Works?
Submit a request form on The Mortgage Works’ website.
How long does it take to receive the statement?
It takes up to 5 working days to receive a statement.
What fees should I expect to pay?
Fees may include an Early Repayment Charge (ERC), redemption administration fees, and daily interest.
Can I avoid Early Repayment Charges (ERC)?
You can avoid ERCs by waiting until your fixed-rate period ends before paying off your mortgage.
What happens if I don’t pay by the redemption date?
If payment is delayed, you’ll be charged daily interest on the outstanding balance.
How do I know my mortgage is fully paid?
The Mortgage Works will send a confirmation letter and release the title deed within 20 working days.
