Natwest mortgage overpayment no option to reduce term

The_Palmist

Hi, I have a mortgage with natwest and when wanting to overpay 10%, it automatically reduces monthly payments but there is no option to reduce the term. I was hoping to make some interest savings by overpaying, keeping the payments same and reducing overall term.

Anyone else had similar experiences with Natwest?

K_S

The_Palmist said:

Hi, I have a mortgage with natwest and when wanting to overpay 10%, it automatically reduces monthly payments but there is no option to reduce the term. I was hoping to make some interest savings by overpaying, keeping the payments same and reducing overall term.

Anyone else had similar experiences with Natwest?

@the_palmist From their page here https://supportcentre.natwest.com/Searchable/913208662/How-do-I-make-an-overpayment-on-my-mortgage.htm it looks like if you want to reduce the term, you need to call them. They mention 'making an application' so I'm not entirely sure what it involves.


If you want to retain the flexibility of going back to a lower contractual monthly payment while still making the same interest savings that you would if you reduced the term, it may be worth having a read of this blog
https://blog.moneysavingexpert.com/2014/10/dont-shorten-your-mortgage-term-if-you-can-overpay/

The_Palmist

K_S said:

The_Palmist said:

Hi, I have a mortgage with natwest and when wanting to overpay 10%, it automatically reduces monthly payments but there is no option to reduce the term. I was hoping to make some interest savings by overpaying, keeping the payments same and reducing overall term.

Anyone else had similar experiences with Natwest?

@the_palmist From their page here https://supportcentre.natwest.com/Searchable/913208662/How-do-I-make-an-overpayment-on-my-mortgage.htm it looks like if you want to reduce the term, you need to call them. They mention 'making an application' so I'm not entirely sure what it involves.


If you want to retain the flexibility of going back to a lower contractual monthly payment while still making the same interest savings that you would if you reduced the term, it may be worth having a read of this blog
https://blog.moneysavingexpert.com/2014/10/dont-shorten-your-mortgage-term-if-you-can-overpay/

Thanks, they have a cheeky 35quid application fee also. I have a Santander Mortgage also and their overpayment system was much better

TrickyDicky101

The_Palmist said:

Hi, I have a mortgage with natwest and when wanting to overpay 10%, it automatically reduces monthly payments but there is no option to reduce the term. I was hoping to make some interest savings by overpaying, keeping the payments same and reducing overall term.

Anyone else had similar experiences with Natwest?

Even with reduced monthly payments you will still make significant interest savings over the term of the mortgage as a result of your overpayment(s).  It will have a relatively minor impact on interest charges during the fixed term of your mortgage (ie where ERCs apply) and should you wish to reduce the term (and increase the monthly payment back to where it was) you could do this when you renew your fix/remortgage to another provider.

Aliliva

On my NatWest mortgage they don't update the monthly direct debit for overpayment under £1000. It might be worth asking them if the £1000 applies daily or monthly or else, and if the former you can just overpay £999 per day fora a few days or weeks. The only thing to consider is that the term and the payment resets when you fix again, unless you remember to negotiate otherwise.