Nationwide Overpayment Reserve

Claireybeau

So for the last 10 years we have had our mortgage with Nationwide and making regular overpayments - now adding up to about 36k in the Overpayment reserve. We are now due to pay off our house early next month - owing only just under 3k so I rang to speak to Nationwide and I am now very confused....

I asked what fees we had to pay off - any ERC etc and he said none and implied that we would get money back and I am confused as it sounded like we were getting the money in the Overpayment reserve back??? I assume that the money we had been paying off came off the mortgage and the reserve was for info sake so that we didn't overpay too much and trigger any early repayment charges...Think perhaps I had a call handler who's wording was a bit misleading ...very confused

Lilla_D

It's difficult fo us to comment on it, because the details depend on your actual mortgage deal you took out 10 years ago and any deals you've had since.

However, by doing a google search for "Nationwide overpayment reserve", the very first result is Nationwide's own page explaining what it is:
https://www.nationwide.co.uk/support/support-articles/important-information/overpayment-reserve

Based on this, I'd go with whatever the call handler said.

fred246

The overpayment reserve represents a sum of your overpayments. The idea was you could overpay but if you ever wanted it back you just phoned them. I think legislation caused them issues because I think they now have to check that you can afford to pay the repayments if you ask for it back. Anyway as far as I understand it you won't get that back. I used it when I knew an inheritance was on its way. Took out £20k of my reserve to put in an ISA and then I could put another £20k in when my inheritance arrived in the next tax year as well as paying off mortgage. It may be worth rethinking if you want to pay it off totally. At the moment you have ability to borrow £36k at very low interest rate.

Claireybeau

Thanks Fred - this is what I thought. Would have been a fab surprise though 😂 we are paying it off 4 years early which is fab. My Hubby is 61 so we want to get it cleared and be debt free