Page 26 - June 2022

EXPERT ADVICE

Overpaying a mortgage:
what do you need to know?

David Lauder, independent mortgage advisor at ESPC Mortgages, shares
what you need to know about making overpayments on your mortgage.

here are many different types of savings to be offset against the mortgage
mortgage available at present – balance and you will only pay interest on the
Thowever, many people are unaware that difference between the two.
almost all of these have an overpayment facility AFFORDABLE HOMES
available. This includes the most popular types Another option is no tie-in products, which
of mortgages, which are your fixed/tracker allow you to make unlimited overpayments AVAILABLE IN EDINBURGH
rates during the chosen preferential period. at any given time, without any penalty. Please
note that the rates are likely to be higher for A number of properties at Cammo Meadows are ‘Golden Share’ homes
An overpayment facility means that you can the additional flexibility on the offset and no
pay in lump sums or regular overpayments, tie-in options, so really it depends on how well meaning that the for sale price is capped at an affordable level – you will
without any penalty, for typically up to 10% you intend to use this facility. own 100% of the property but the price is capped at 80% of the market
of the capital balance outstanding per annum value on the fi rst sale and all subsequent re-sales.
during the chosen preferential rate period. To summarise, an overpayment facility is an
option that is not used enough and is available Maybury Road, Edinburgh EH4 8DY
The benefit of this to you as the mortgage on most mortgages. If circumstances allow,
holder is that your mortgage balance will this facility can be very powerful as the total
reduce and in turn, so will the term, if you keep interest payable could be considerably less
the monthly repayments the same. This means during the mortgage term, which in turn will
that you could potentially save thousands in mean more money in your pocket - even small,
interest over the whole mortgage term, as it regular monthly increases of £50 will provide a
is a purely capital payment with no interest significant saving over the total term over the
accrued to it. course of time.

Some providers also offer the choice to reduce GET MORTGAGE ADVICE TODAY
the payments in line with the revised balance, ESPC Mortgages is a team of independent
which is especially helpful for maternity leave mortgage advisers based in Edinburgh. With
or sabbatical breaks in employment. many years of experience, they are well-placed
to help you purchase your first property. Get Two bedroom homes A range of apartments and houses Prices from £195,200
If a 10% overpayment is not enough, then there in touch with the team on 0131 253 2920 or
are other options available. Offset mortgages fsenquiries@espc.com.
are popular - this is where you can use existing
See the Difference at dwh.co.uk
The information contained in this article is provided in good HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP or call 0333 355 8461
faith. Whilst every care has been taken in the preparation of the UP REPAYMENTS ON A MORTGAGE OR OTHER LOANS
information, no responsibility is accepted for any errors which, SECURED AGAINST IT.
despite our precautions, it may contain.
ESPC UK LTD is an appointed representative of Lyncombe Offer available on selected plots only. Terms and conditions apply. See website for details, subject to contract and status. Prices correct at time of publishing if
The initial consultation with an adviser is free and without consultants which is authorised and regulated by the Financial mentioned. Images include optional upgrades at additional cost. Following withdrawal or termination of any offer, we reserve the right to extend, reintroduce or
amend any such offer as we see fi t at any time. Barratt Homes is a brand of BDW TRADING LIMITED (Company Number 03018173), a company registered in England
obligation. Thereafter, ESPC Mortgages charges for mortgage Conduct Authority. whose registered offi ce is at Barratt House, Cartwright Way, Forest Business Park, Bardon Hill, Coalville, Leicestershire LE67 1UF, VAT number GB633481836. Calls to 03
advice are usually £350 (£295 for first-time buyers). YOUR numbers are charged at the same rate as dialling an 01 or 02 number. If your fi xed line or mobile service has inclusive minutes to 01/02 numbers, then calls to 03 are
counted as part of this inclusive call volume. Non-BT customers and mobile phone users should contact their service providers for information about the cost of calls.
These properties are available to those who meet the affordability criteria for the City of Edinburgh Council’s Golden Share scheme. Ask our Sales Adviser for full Ts&Cs.
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