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Page 6 of 11
Getting a Fair Deal on a Mortgage
5. Can I make lump sum payments to reduce the size of the loan?
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Are there any limits on how much I can pay in one go?
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Do the payments have immediate effect?
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If I make them during any tied period do I have to pay any penalty?
Some lenders will not let you make lump sum payments unless you pay quite a lot in one go. Some lenders do not take these payments into account until the end of the year, which means you are still paying interest on the original debt, even though you've paid some of it off. Some lenders will charge a redemption penalty.
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Personal Finance