Nationwide additional borrowing on mortgage

confusedbunny368

Hello, partner and I completed on house purchase 9 months ago. Lender is Nationwide and we're on a 5 year fix @3%, payments are manageable. We are now about to undertake home improvements and although we have built up our savings pot we would like to borrow another £75,000 to cover anything unexpected that may come up with the building work.

We understand Nationwide will lend us this amount on a tracker at 1.79%. What we would like to know is, if six months down the line we realize we haven't had to dip into the full amount of the extra lending can we use it to make an overpayment to our main mortgage which is at a higher rate?

Thank you.

busybe

Fixed rate mortgages usually have early repayment charges (ERC).
Some fixed rate mortgages usually allow small overpayments without incurring ERC e.g. 10% of the balance at start of the year.
Check with Nationwide what their ERCs are and how much you can overpay without incurring ERC.

confusedbunny368

busybe wrote: »

Fixed rate mortgages usually have early repayment charges (ERC).
Some fixed rate mortgages usually allow small overpayments without incurring ERC e.g. 10% of the balance at start of the year.
Check with Nationwide what their ERCs are and how much you can overpay without incurring ERC.

Thank you, yes we're allowed end to pay the 10% without incurring ERC. I just wondered if they will stipulate we have to pay off the smaller mortgage first, although we'd like to clear the bigger one as its at a higher rate 3%.