Property January 9, 2017
     

Mortgage Advice: Early Repayment Charges

Homebuyers are enjoying record low mortgage rates, but must make sure they understand that there will usually be a penalty to pay if they want to leave their deal early.

In return for securing the lower rates on the market, borrowers are typically ‘locked in’ to their deal by lenders imposing hefty early repayment charges. These are usually charged as a percentage of the loan.

Early repayment charges are payable if you want to come out of a deal early, switch lender, or make significant capital repayments over the 10% that is typically allowed.

Only once the deal ends, and the borrower moves onto the lender’s standard variable rate, will they be free to move without penalty.

Early repayment charges can run into thousands of pounds, and the earlier you want to get out of your deal, the steeper the cost will be.

Borrowers should therefore always read their mortgage small print carefully before signing up to any deal so they understand the true cost of leaving that deal before it ends.

There are options available for borrowers looking for greater flexibility. Some lenders offer deals with no early repayment charges, which would suit those wanting to overpay their mortgage, or who think that their circumstances might change before their deal ends.

Before committing to any mortgage deal, borrowers should always consider their future plans and the financial impact that early repayment charges could have.

How to be a Good Landlord During the Festive Season

How to Find the Right Rental Property for You

The Spookiest Places to Live in the UK

Why Autumn is a Good Time to Move Home

Contact Us

Moreland Estate Agents
903-905 Finchley Road
Golders Green
NW11 7PE

Tel: 0208 381 4970
Email: info@moreland.uk.com

Follow Us

Moreland Estate Agents FacebookMoreland Estate Agents TwitterMoreland Estate Agents InstagramMoreland Estate Agents LinkedInMoreland Estate Agents YouTube Channel


The Guild of Property ProfessionalsTerms and Conditions | Privacy Policy | Cookie Policy | Complaints Procedure | Fees | Code of Practice | Disclaimer | Client Money Protection                                                                                                                                                                   

2021 © Moreland Estates Ltd is a company registered in England and Wales with company number 03663497.
VAT Registration Number: GB 701 775 936.
Trading Address is: 903 - 905 Finchley Road, Golders Green, London, NW11 7PE.
Registered Office is: Unit 8 Alpha Business Park, Travellers Close, Welham Green, Hertfordshire, AL9 7NT.

Check mortgage eligibility online