Overpayments could save you money

We want to help you manage your mortgage more effectively. If you have a mortgage which allows you to make additional payments or overpayments, you are able to make extra payments on top of your standard monthly payment either by making regular overpayments or by making lump sum payments. This means you could:

• Pay off your mortgage earlier
• Reduce the amount of interest payable - the interest chargeable on the outstanding mortgage balance is calculated every day rather than every week, month or year
Firstly, you need to check what type of mortgage you hold:
• If you have a fixed rate mortgage, you'll have an annual overpayment allowance (AOA) to enable you to make additional payments during the fixed or discounted rate period without incurring an Early Repayment Charge (ERC). The allowance is equivalent to 10% of the outstanding balance of your mortgage calculated on each anniversary of the start of your fixed rate period
• As long as you do not exceed your annual overpayment allowance during a year when the Early Repayment Charge applies, you can make as many overpayments as you like within that year either by increasing your monthly mortgage payments or making lump sum payments
• If you exceed your annual overpayment allowance, the ERC will be charged on the amount you have repaid over the allowance
• Tracker/ Variable/ Home Buyers' Variable rates have no limits or charges for making additional payments