Lloyds double mortgage overpayment limit

Date:Wednesday 17th March 2010

Catherine Hearnden, director at MyMortgageDirect, believes that other lenders will follow suit and begin to offer the same type of deal, which encourages householders to repay their mortgage loan first rather than the interest.

Talking about the effects of this product on lending rates, she added: "If rates go up they borrowers have got a lower balance so they do not have to pay as much."

This product which allows repayments of up to 20 per cent with no financial penalties, in spite of accrued interest will apply to anyone who has a variable rate mortgage with Lloyds.

According to reports published this month by the Bank of England, lending to individuals rose by £2 billion in January and the average cost of a two-year mortgage deal fell to its lowest level since 2003.