An early repayment charge (ERC) is a fee your lender charges if you repay your mortgage or switch to a new deal before your current fixed or discounted period ends. It is typically between 1% and 5% of the outstanding balance, and usually decreases each year you are in the deal.
Year 1 of a 5-year fix5% ERC
Year 24% ERC
Year 33% ERC
Year 42% ERC
Year 51% ERC
On a £200,000 balance at 3%£6,000
- The savings on the new deal outweigh the ERC over the remaining period
- You are on a tracker or variable rate with no ERCs
- You are moving house and need to arrange a new mortgage anyway
- Your ERC is close to expiring and you want to lock in a new rate before it increases
- You need to raise additional funds and your current lender cannot help
Your ERC details are in your original mortgage offer document. You can also request a redemption statement from your lender, which will show the total amount needed to repay your mortgage in full, including any ERCs. Most lenders can issue this within a few working days.
Is it worth switching early?
We will run the numbers and tell you honestly whether remortgaging early saves you money or costs you more.
Speak to us