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After it’s started

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Monthly repayments

Once your loan has started we will write to you to confirm the amount of your monthly repayments. We will also tell you when you have to start making your monthly repayments. These are normally made by direct debit. However, you may pay by standing order, cheque or cash.

Your loan repayments are due on the first day of each month along with the premiums for any insurance policies arranged through the Society.

Interest on your mortgage

We begin to charge interest on your loan on the day that we transfer the money to your solicitor, or when the funds are released.
We charge interest on most of our mortgage products on the basis known as ‘monthly rests’. This means that interest is charged on the balance at the start of each month. Therefore as your balance reduces so does the interest charged. However, if payments are missed and your balance increases then so will the interest charged.

Interest rate changes

The timing of a change to your monthly payments will vary.

(a) We may reduce any rate of interest payable under your mortgage and we may also increase at any time (whether or not with immediate effect) any rate of interest payable under your mortgage if we reasonably believe that the change is needed for any one or more of the following reasons (which
may relate to circumstances existing at the time or which we reasonably expect to apply in the near future):

1. to respond, in a proportionate manner, to changes in the Bank of England Base Rate;
2. to respond, in a proportionate manner, to interest rates generally charged by our competitors in the mortgage market;
3. to respond, in proportionate way, to changes in the cost to us of raising the money we lend to our customers by way of mortgage;
4. to enable us to maintain the competitiveness of interest rates charged to our investors, while having regard to the interests of our borrowers, in the interests of our business as a whole;
5. to respond, in a proportionate manner, to any increase or reduction in costs reasonably incurred by us in operating or mortgage services;
6. to respond, in a proportionate manner, to changes that have been made or are about to be made, in the law or interpretation of the law, relevant codes of practice, the way we are regulated, or any decision by an ombudsman, court, tribunal, regulator or similar body; or
7. it is necessary to maintain our financial strength in the interests of all our customers.

(b) We can also change the Interest Rate for any other valid reason (other than those mentioned in (a) above) where we reasonably believe the change is appropriate. If we do so:

1. we will give you notice of the change by posting or delivering the notice to you under condition 18 before such change is to take effect; and
2. you can, within 3 months of our notifying you of the change, without having to give us any notice, repay the Whole Debt without having to pay an early repayment charge; and
3. we will tell you this and that we are increasing the interest rate in accordance with this condition 4 (5) (b) when we give you the notice.

(c) The rate of interest will not be charged for any of the reasons stated in conditions (a) or (b) above in a manner which would put customers who have received an incentive in a less advantageous position than a new customer or a customer who is free to redeem their account without loss or
repayment of any incentive.

We will tell you about rate changes before the date the change takes effect by letter or other personal notice and, subject to these Conditions, any such change shall not take effect on a date earlier than the date specified in your letter or other personal notice.

Additional repayments

You can make additional payments to your loan over and above your monthly repayments in order to reduce the capital outstanding on your loan. The effect of this can be to reduce the amount of your monthly repayments. If your loan is being repaid on the repayment basis you also have the option to retain your current level of repayment thereby reducing the remaining term of your loan.

We normally require that any additional payment to permanently reduce the capital on your loan is at least £500.

Please note that where an incentive has been received e.g. a cashback, discount, fixed rate or capped rate, an early repayment charge maybe payable where you make an additional repayment during the first few years of the mortgage. Where this condition applies we will advise you and it will be stated in the Mortgage Offer and Key Fact Illustration.

Credit reference agencies

When you apply for a loan we will make searches about you at credit reference agencies who will supply us with credit information as well as information from the Electoral Register.
The Agencies will record details of the search whether or not your application proceeds.

Once your loan is granted we will disclose information about how you manage your account to credit reference agencies. This will be shared with other lenders and providers of credit when they are considering loan or credit card applications from you.

We may make periodic searches of group records, credit reference and fraud prevention agencies to manage your account with us, to take decisions regarding credit, including whether to make credit available or to continue or extend existing credit. The searches will not be seen or used by lenders to assess your ability to obtain credit.

Your annual statement

Early each year we will send you your mortgage statement. This will show:

• the total payments which we have received from you during the previous year
• the total interest charged on your loan for that year
• the total of any other transactions on your loan account during the year, which might be the payment of a charge for a service provided by us
• remaining term of the mortgage
• any outstanding subscriptions
• any early repayment charges which may apply

Early repayment charge

If you already have a mortgage with the Furness and want to move home, you will have to pay off (redeem) your existing mortgage and will have to pay any Early Repayment Charge if applicable under the terms of your existing mortgage.You would normally have to pay the Early Repayment Charge when repaying your loan but it is possible some or all of the Early Repayment Charge can be refunded if you take out a new mortgage with us providing you comply with the conditions set out below.

In order to get a full refund of your Early Repayment Charge you must take out a new mortgage with us for the same amount as your existing mortgage and carry forward the existing product terms to your new mortgage. In addition you will have to comply with the lending criteria applying at that time and complete your new mortgage within 6 months of repaying your existing loan.

If you need to borrow more when you move you can often top up the difference between the portable amount and your new loan with one of our other products which is available at the time.

If you borrow less than the portable amount, then we can only refund part - on a pro rata basis - of the Early Repayment Charge which you paid e.g. if your existing mortgage is £50,000 and you only wish to borrow £40,000 on the new mortgage, 80% of the Early Repayment Charge will be refunded on completion of the new mortgage.

The terms applying to the portable amount of your mortgage will depend on the terms applicable to your existing loan when your new mortgage completes. If you are still benefiting from a special product on the portable amount i.e. the loan is still on a fixed or other rate, then the portable amount must continue on the same interest rate and terms as your existing mortgage for the initial period and on the Society’s standard variable rate thereafter.

Existing borrower discount

Borrowers of the Society for 5 years who have conducted a mortgage satisfactorily on their private dwelling house, which they occupy as their main residence, may be eligible to receive our existing borrower discount.

The existing borrower discount is for an indefinite period but it cannot be guaranteed for the lifetime of all mortgages. You will be advised by the Society if the existing borrower discount is to apply.

Please Note: The existing borrower discount does not apply to all of the Society’s mortgage products.

Service charges

We make a charge for certain services which we provide in connection with your loan.

These are listed in our ‘Service Charges’ leaflet which will be given to you when you receive your Mortgage Offer and at any time if you ask for it.

We can alter the charges we make at any time, but we will give you 30 days' notice.

Changes may include the abolition of, or amendment to, existing charges, or the introduction of new charges. Such changes may be made because of circumstances which we reasonably believe exist at that time or which are expected to apply in the near future for any of the following reasons:

We can make other changes to our Costs (including increasing or introducing new Costs) if we reasonably believe that the change is needed for any one or more of the following reasons (which may relate to circumstances existing at the time or which we reasonably expect to apply in the near future):

• (a) to respond, in a proportionate manner, to any new or increased cost which we reasonably incur in operating your mortgage account:
• (b) to respond, in a proportionate manner, to changes which we may reasonably make in the services we provide;
• (c) to respond, in a proportionate manner, to changes that have been made or are about to be made, in the law or interpretation of the law, relevant codes of practice, the way we are regulated, or any decision by an ombudsman, court, tribunal, regulator or similar body;
• (d) to make our charges operate more fairly between our consumer customers generally; or
• (e) to enable us to harmonise, in a reasonable manner, charges following any acquisition of mortgage accounts or any takeover merge with another mortgage loan provider.

Where we vary a Cost under Condition 6 (5) we will give you notice of the change by posting or delivering the notice to you, or as soon as reasonably practicable, after the change is to take effect.

A change which abolishes a charge, or reduces the amount of any existing charge, may be introduced with immediate effect and without notice.

Death

We recommend that you consider arranging a life policy to repay your mortgage in full in the event of your death.

In the event of your death we will advise your personal representatives of the amount required to repay your mortgage.

There are a number of things which would happen:

• your personal representatives repay the loan with other money from your estate;
• your personal representatives sell your property and repay the loan with the sale proceeds;
• we sell your property and repay the loan with the sale proceeds; or
• another person takes over your mortgage and makes the monthly repayments to us. This might happen if you leave your property to another person who wants to live in it.

These options also apply if you have a life policy which is not enough to repay your mortgage in full.

We will speak with your personal representatives to try to find a way of repaying your loan which suits everyone concerned.