Lloyds mortgage overpayments reduce long-term interest

Date:Monday 15th March 2010

Stephen Noakes, commercial director of mortgages for the company, commented on the current low mortgage rate levels and suggested more people could afford to overpay and make savings.

He said: "Customers have a choice to make to gain maximum advantage from the extra cash in their pocket."

Mr Noakes added that average mortgage repayments had fallen by £188 per month and people with tracker rates are £400 better off, which means the majority can afford to overpay.

Moneysupermarket.com recently recommended switching to an offset mortgage deal which would provide an alternative to the Lloyds mortgage overpayment facility.

Hannah Mercedes-Skenfield, mortgage channel manager at the comparison website, said that offsetting could allow homeowners to make the most of their money, paying interest on the difference in value of the mortgage and savings.