21
Jan
Bank reveals customers overpaying on mortgages
Lloyds TSB has said thousands of its customers are choosing to
overpay on their mortgages following the most recent base rate
cut.
The bank has revealed that since the reduction in the rate to 1.5
per cent this month, it has had 27,000 requests from customers to
make overpayments on their mortgages.
It noted that this trend has also been seen - though on a smaller
scale - in previous months, with 7,000 overpayment requests in
November and 12,500 in December.
By overpaying, customers may be able to pay off their loans
early.
Earlier this week price comparison website Moneysupermarket.com
calculated that tracker product holders with monthly repayments of
£1,000 could save as much as £16,000 and finish their
repayments nine years early on the basis of maintaining the payment
level.
The site based this calculation on a £163,000 tracker mortgage
at a 5.49 per cent rate in October, which will now charge 1.99 per
cent.
