nationwide overpayment

GSingh

Hi. sorry if this has been asked before. but if I owe 100000 on my mortgage and pay 500 per month and wish to make an overpayment of 200 per month what happens to future payments and the balance of my account.

nationwide website says this, but. don't understand what it means

How overpayments work

We calculate the interest on your mortgage daily so all overpayments will reduce the interest you pay the following day.

For overpayments of less than £500 per month:

We’ll reduce your minimum monthly payment at the next natural recalculation point, i.e. an interest rate change.

For single overpayments of £500 or more per month:

We'll automatically reduce your minimum monthly payments the following month. However you can change your preference in the 'Overpaying by £500 or more' section.

Zero_Sum

If you make a £200 overpayment, your payments remain the same
Its only if the actual overpayment (ie over & above the minimum payment) do they then recalculate & reduce your new minimum payment.

nyc_451

If you want to reduce your mortgage term instead of reducing your monthly payments, you will need to phone them up and change the preference. You might be able to do it online too, my agreement said I had to ring customer services.