NatWest has announced that new and existing mortgage customers can now make an overpayment of up to 20% without incurring an Early Repayment Charge (ERC), doubling the previous limit of 10%.
This feature will renew annually on the anniversary of the product drawdown and apply to both fixed and tracker rate products.
The move aims to offer greater flexibility to borrowers who wish to pay off their mortgages faster without penalty, as well as help those who have a windfall at some point.
Free PR platform, Newspage, asked brokers for their thoughts on this announcement. Simon Bridgland, broker/director at Release Freedom, called it a useful feature that will gain and retain more business for NatWest.
While Scott Taylor-Barr, Financial Adviser at Carl Summers Financial Services, added that reducing mortgage balance is a sensible way of using money. Meanwhile, Lewis Shaw, Owner and Mortgage Broker at Riverside Mortgages, called the change “odd” but positive.
Luke Thompson, director at PAB Wealth Management, praised the move for giving customers the opportunity to save thousands of pounds in interest over the life of the mortgage.
And finally, Graham Cox, director at self-employed mortgage broker SEMH, lauded NatWest for offering a real point of difference as most lenders only allow a 10% overpayment of the mortgage balance per year.
