Regular and lump-sum overpayments

 

Regular overpayments


If I make regular overpayments how will they affect my mortgage?

If you are on our daily interest method, regular overpayments will reduce immediately, the amount that you owe and the interest you are charged.

If you'd like to make regular overpayments you can let us know by using our downloadable form .You can also use the form if you want to change or cancel any existing overpayments you are already making.

Use our regular overpayments form - PDF file – Acrobat reader required (86k)

Lump-sum overpayments

You can pay part of your mortgage whenever you want. They are known as lump-sum overpayments. If you are on our daily interest method, when you make a payment your mortgage balance will be reduced on the day we receive the money, and you’ll start to be charged less interest. Then, because your balance is lower, you can either:

Keep paying your current monthly payment so that you repay your mortgage sooner. However, when we next re-calculate your monthly payment, for example at an interest rate change, we will set the new monthly payment to a level that will repay your mortgage over the current mortgage term or.

Ask us to re-calculate your monthly payment immediately, so that you get to reduce your monthly payments but still repay your loan by the end of the current mortgage term reduced, or if your mortgage is set up on a repayment basis, you can apply to change the remaining term. If you do this, you will need to speak to one of our mortgage advisers who will check that you can afford the monthly payments over the new term and advise you if this is right for you.

If you make a lump-sum overpayment, it can't normally be refunded at a later date.

Important - Early Repayment Charges (ERCs)

An early repayment charge applies on some mortgages. You may have to pay this if, during your early repayment charge period, you repay more than a certain amount of your mortgage or switch to a new mortgage deal.

You can currently make extra payments of up to 10% of the mortgage balance (as at 1st January) each year before a charge applies, unless you go on to repay or change the rest of the loan within the next six months. We may change or withdraw this concession at any time but we will give you three months’ notice before doing so.

How much the charge is varies, depending on how long you have left on your mortgage deal.

See the Early Repayment Charge page for further information.

YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE

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