Nationwide overpayment options - Help!

KarenBB

With option 1 the term is reduced when you overpay and Nationwide do this without a fee. If you borrowback any money the repayments are calculated on the latest term so if you've gone down from 15 years to 10 years and then borrow a big chunk back your new payments are calculated over 10 years so they would be higher. You can extend the term at that point if you want to by filling in a change of term application BUT there is a charge for this, currently £20. Not huge but a fee all the same.

I'd go for option 2 or 3 and adjust my overpayment accordingly. I don't even have my mortgage paid by DD, I just pay as and when (husbands pay day is eratic and I'm in a product without penalties so not a problem), if you want to pay a set amount each month and don't want to keep changing the overpayment you could just cancel your direct debit and set up a standing order for the amount you want. The effect will be that your mortgage will be paid off earlier but you can pay a lower amount should you chose to, you can borrow back any overpayments and shouldn't need to adjust the term and incur a fee. As long as you leave a small balance on the account, £1 the account stays open and you can borrowback at anytime.

kingstreet - the agreed date isn't the original redemption date if the term has been changed, it's whatever it is at that time - but as I say it can be changed again to the original date or even later, (max term 40 years, max age of the oldest person on the mortgage at redemption 75)

Radionotme

Surely the best option is to instead pay off £499.99 extra per month? Effectively £500, but doesn't trigger the change of term, and also allows the borrowback when needed.