In return for the benefits offered by some C&G mortgages, the loan may carry a charge if you repay all or part of it in the early years or switch to a different mortgage - these are called early repayment charges.
The limit on any extra payments you can make each year before the charge applies is 10% of the mortgage balance. This means if you have a mortgage subject to an early repayment charge you can pay up to 10% of your mortgage balance before incurring the charge, unless you go on to repay or change the rest of the loan within the next six months. The charge varies, depending on how long you have left on your mortgage deal.
The 10% overpayments limit is a concession and could be withdrawn at any time.
If you move home, you may be able to take the terms of your current C&G mortgage with you. This could be so you continue to benefit from a particular deal you took out, such as a fixed rate or tracker that you want to keep until the end of the original period of the deal, or to avoid having to pay an early repayment charge.
Of course, we need to be satisfied with the new property and that you can afford the repayments on the mortgage on the new property. Taking your current deal with you means that, when you repay the mortgage on your current home to move, you take out a new C&G mortgage on your new home for at least the same amount and it continues on the same terms as the current one.
In other words, any fixed rate or tracker would continue to apply for the remainder of the original deal period; and, if there's an early repayment charge on your mortgage, you won't have to pay it. The charge would still apply though if, after you'd moved, you subsequently repaid the mortgage (or more than 10% of it) while you were still benefiting from the fixed rate or tracker.
If there’s a delay between repaying your current C&G mortgage and taking out a new one on a new property, then you will have to pay any early repayment charge. However, if your new mortgage starts within eight weeks of the current one being repaid and, apart from the delay, everything else above applies, then the early repayment charge will be refunded.
If you want to take your current deal with you when you move, but borrow more on top, you’ll be able to choose from the deals available at that time for the extra you need. It’s also important to note that our lending policy at that time will also apply, and this could be different from the policy that applied at the time of your most recent application. In some cases – for example, where you want to borrow more in relation to your income than we are prepared to lend on standard terms – the additional borrowing will only be agreed if the whole of your new mortgage is on specific terms. This may mean that you will be unable to transfer the terms of this mortgage as described above.
If you move and want to take your mortgage deal with you, but your new mortgage is for a smaller amount, any early repayment charge that you have to pay will be based on the difference between the two mortgages.If you are borrowing less and there’s a delay between repaying the current mortgage and taking out the new one, the paragraph above, ‘If there’s a delay in your move’, applies, but the amount refunded will be calculated proportionately.
If your mortgage began before 1 November 2008, a different policy may apply, please call our Helpline on 0845 603 1637 for details.
