From: "Simon" 
Newsgroups: uk.finance
Subject: Re: Paying Off Mortgage
Date: Sun, 18 Nov 2007 07:34:27 -0000
Bytes: 2941

"Clifford Frisby"  wrote in message
news:fhmtlt$obl$1$8300dec7@news.demon.co.uk...
> Halmyre wrote:
>
> > If you're in the position to pay it off, is it a good idea to leave a
> > small amount outstanding on your mortgage? Doing so can apparently be of
> > benefit to avoid start-up charges if you ever want to move house,
maintain
> > your credit rating, safely store title deeds, etc. I would guess that
the
> > first of these is probably most valid, but is it really worth doing?
> >
>
> It's just a thought, and possibly a silly one, but there's another
potential
> reason to keep a trivial amount owing, which may or may not be important
to
> you.
>
> These days it's easy for anyone to see whether there is a charge on your
> property (which there will be if you have an outstanding mortgage or
> secured loan).
>
> If there is no charge, then people can, with reasonable confidence, make
> some inferences about your personal balance sheet, i.e. that you don't
have
> much debt (because any debt you have is probably unsecured) despite the
> fact that you have a valuable asset.
>
> But if there is a charge showing, then they are none the wiser as to
whether
> you owe hundreds of thousands of pounds or just a few pence. Obfuscation
> protects your financial privacy.
>
> As I said, it's just a thought. Probably flawed in some way.
>

This is a good point. I don't go around telling strangers what my net
financial worth is, but the Land Registry website allows people to determine
this quite accurately if I don't have a mortgage. A few years ago, when I
was buying my current house, I wanted to find out a bit about my prospective
new neighbours before committing myself. The Land Registry website allowed
me to find out what charges there were against their properties which told
me something about them. As an aside, you can infer information from what
kind of organisation holds the charge, eg. prime lender, a subprime lender,
a shared-equity organisation, and whether the charges have changed recently.