What are Early Repayment Charges?

Early Repayment Charges (ERC’s) would be detailed on your Key Facts Illustration and Mortgage Offer and these can vary in percentage from one lender to the next – typically they will apply if you redeem either all of your mortgage or a certain amount of it, whilst still within the initial product term – so for example, you’ve just got a 2 year fixed rate mortgage and 3 months later you win the lottery and pay the whole thing off. Chances are you’ll have a penalty which we’d estimate to be 2 or 3% of the balance owed.