Lloyds extends overpayments

Lloyds Banking Group is allowing all of its tracker rate mortgage customers
to make overpayments of up to 20 per cent for the next 12 months.

The lender currently limits overpayments
to 10 per cent – a standard rate across the industry – for borrowers on variable and fixed-rate deals. Borrowers on tracker
rates can now double
their overpayments until
March 31 2011.

“With mortgage rates
at a historic low, there
has never been a better time for the majority of people to overpay their mortgages,” said Stephen Noakes, Lloyds’ commercial director of mortgages .

Borrowers on tracker mortgages have seen
their repayments drop by as much as £400 a month due to current low rates.

Overpaying by just £50 per month would reduce the term of a £100,000 mortgage with a standard variable rate of 3.5 per cent by three years and six months, Lloyds said.

Tanya Powley