Early Repayment Charge

Early Repayment Charge is a charge made by your mortgage lender, which is payable on certain types of loan - usually (but not always) discounted or fixed interest rate loans.

The charge is only applied if the loan is redeemed or part-redeemed within the specified fixed or discounted rate period.

This is the downside of benefiting from the certainty conferred by fixed rates or the cheaper loans offered via discounted rates.

Be warned, if someone is offering you an incredibly good interest rate, the chances are they want something - your loyalty, and that could mean it'll cost you if you decide to move lender in future.

See Also: Mortgage Centre and Mortgage Comparison Service for the latest facts and figures.

Last Updated: May 2007 © Moneyextra.com

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