Key Post The policies of the different banks on overpaying a fixed-rate mortgage

Just to update, BOI allowed me to make a one off payment (even though I was well over the 10% allowed). They calculated that there was no break fee. They have now reduced my monthly repayments in line with that. I asked if I could overpay monthly, as KBC had allowed me to. They haven't got back to me on that. If they don't, I'll just pay another lump sum in a few months when I have accrued more savings.
 
Stitcher said:
Just to update, BOI allowed me to make a one off payment (even though I was well over the 10% allowed). They calculated that there was no break fee. They have now reduced my monthly repayments in line with that. I asked if I could overpay monthly, as KBC had allowed me to. They haven't got back to me on that. If they don't, I'll just pay another lump sum in a few months when I have accrued more savings.
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Thanks for the update. I think we should be hitting the 10% limit in the next few months, so it'll be interesting to see whether they immediately detect that.
 
Hi

I have a 5 year fixed mortgage with BOI. How do I actually overpay the mortgage. I am overpaying by 10% each month but this is taken via direct debit as part of the repayment.

If i want to pay more, can I just set up a standing order to pay more off each month? I have read on here that some people just over payed without penalty. Any thoughts from anyone who has done this?
 
At some point, in a year or two I may plan to overpay my Avant mortgage with a lump sum. If i do this, can i request Avant to shorten term and keep the regular monthly payments the same?
 
imalwayshappy said:
Hi

I have a 5 year fixed mortgage with BOI. How do I actually overpay the mortgage. I am overpaying by 10% each month but this is taken via direct debit as part of the repayment.

If i want to pay more, can I just set up a standing order to pay more off each month? I have read on here that some people just over payed without penalty. Any thoughts from anyone who has done this?
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I recently paid off a lump sum on my new BOI (formar kbc) 3 Yr fixed rate mortgage. There was no penalty as interest rate difference was very large so -ve cost. I had to phone them up, they got back to say it was OK and I could pay over the phone with my bank card.

Although I actually want to overpay monthly, BOI are reluctant to do this for me as I am over the 10% overpayment limit, even though there will never be a charge as the interest rate when I fixed was so low. I will ask again. They said I could overpay again by lump sum if I wanted.
 
dubdub123 said:
At some point, in a year or two I may plan to overpay my Avant mortgage with a lump sum. If i do this, can i request Avant to shorten term and keep the regular monthly payments the same?
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Hi @dubdub123 did you find out the answer to your question? I'm wondering the same thing. I'm also wondering how much can be repaid without incurring the penalty.
 
RedOnion said:
Hi,
Do you have a short term fixed rate, or a "One Mortgage" product (fixed for life)? I'll summarise options for both later.
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Hi,
The mortgage is fixed rate with Avant until 2028 (7 years fixed in total, out of a 15-year mortgage that started in 2021).
We called Avant to find out more but we are honestly more confused now than before about what would incur penalties.
The person on the phone also talked about reducing monthly payment, but we want to shorten the mortgage, not reduce payments!
Thank you!
 
dubdub123 said:
At some point, in a year or two I may plan to overpay my Avant mortgage with a lump sum. If i do this, can i request Avant to shorten term and keep the regular monthly payments the same?
Click to expand...
I have been with Avant since Jan 2022, and have now paid three lump sums (as allowed). My monthly repayments have not changed, as per my request, and my confirmation letter confirms an earlier maturity date instead. I have paid 5% of the outstanding balance at the start of the year in each payment, so a total 10% last year and 5% so far this year (will pay another 5% in December).
 
RedOnion said:
Hi,
Do you have a short term fixed rate, or a "One Mortgage" product (fixed for life)? I'll summarise options for both later.
Click to expand...
Hi
Im 2 years into 10 year fixed for 19 year term (so aroumd 17 years remaining).
Once I pay off a different loan, I jope to overpay mortgage. My understanding is that its max 10% of the outstanding balance at start of year, across 2 lump sum payments.

If you can explain the options id appreciate it. Thanks
 
@dubdub123 , @qwerty-2023
Apologies for the delay on this. I was hoping to find something more definitive.

Avant call this out specifically on their 'One Mortgage' brochure, but my reading is that it applies to all of their fixed rate mortgages. If you contact them about making an overpayment, they will ask you to specify if you want to reduce the term of the repayment amount.
  • Make overpayments up to 10% of balance without triggering a break fee calculation. Maximum of 2 overpayments per year making up this 10% allowance.
  • Any overpayment is excess of that, and a break fee calculation will be performed. Where a break fee does apply, it is capped at 2% of overpayment for first 10 years, and 1.5% thereafter
When you make an overpayment, you have the option of:
• reduce your monthly repayments and keep the existing term of your mortgage; or
• maintain your existing monthly repayments and pay your mortgage off faster (i.e. reduce the remaining term of the mortgage).
 
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