Remortgage & Overpayments

teecee90

I am currently in the process of arranging a remortgage. My current YBS fixed rate mortgage comes to an end on 31st March. I am currently overpaying by about £200 per month.

I have decided to go for a 2yr tracker and have been looking at the Alliance & Leicester 2 yr Tracker (V377R) - 2.15% above base rate.

Having contacted Alliance & Leicester (Santander) and asked them about overpayment they said I wont get any benefit unless I overpay by at least £500 and that most mortgage lenders do the same. I said I thought that most lenders calculate interest on a daily basis these days but didnt get a very satisfactory response.

Having looked on the Alliance & Leicester web site their setion on mortgages has the following condition:

"10% Overpayment Facility – Customers who choose one of these products will have the option of making a one off annual payment of up to 10% of the Interest Bearing Balance (IBB) on their mortgage (without incurring any Early Repayment Charge). Any such overpayment must be for a minimum amount of £500, over and above their monthly mortgage payment, and can only be made during each month of January which falls during the period which an Early Repayment Charge is payable."

This seems to imply that I can only make an overpayment once a year in January and wont be able to overpay on a regular basis. Anybody know if that is right?

If so.....I need to decide whether it is worth just saving up and making one-off overpayments or to go for an alternative more flexible mortgage.

Any views or guidance from moneysavers greatly appreciated.

teecee

jenny_13

Not really sure about the Alliance & Leicester mortgage but if you are looking for a mortgage where you make regular overpayments Nationwide might be a good option. We can overpay upto £500 p/m and I think that's the same for most of their products and was the reason we chose them.