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We offer different types of mortgage products with different interest rates. With some of these there may be a charge if you repay all or part of your loan within a certain period of time, we call these early repayment charges.
Your Mortgage Illustration, offer letter and mortgage statement give details of any early repayment charges that apply to you.
We make these charges because when setting up the funds to provide loans to customers, we expect them to keep the money for the time agreed at the outset. There is a cost to us if they repay some or all of the loan sooner. The charge is designed to compensate us for this cost.
We'll apply an early repayment charge if, before the end of the early repayment charge period you:
The charge will never be more than the maximum amount set out in your offer letter and Mortgage Illustration and will be based on:
If you are in a fixed rate an ERC could be payable up to and including the last day of this rate, please check your illustration and or offer for details of your particular rate.
Currently, as a concession, in each calendar year you can make regular or lump-sum overpayments of up to 10% of the amount owed at 1st January without having to pay an early repayment charge. (This is for any product where an early repayment charge applies.)
If the total amount you overpay during the year exceeds 10%, we'll only charge you an early repayment charge on the proportion you overpay above 10%.
If you then repay the loan in full within six months of making a regular or lump-sum overpayment, we'll require you to pay the full early repayment charge, including the portion we previously did not charge.
Remember, we can change or withdraw our 10% early repayment charge concession, so if you decide you want to make regular or lump-sum overpayments, it’s always a good idea to contact us and check if the policy has changed. We will give at least 3 months notice before withdrawing or reducing the concession.
If you're moving home and can take the product rate with the early repayment charge with you to a new mortgage, you'll not have to pay the early repayment charge. This is also known as porting.