Can I overpay my mortgage without penalty?
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In short: Most fixed-rate mortgages allow penalty-free overpayments of up to 10% of the balance per year. Tracker, variable and offset mortgages typically allow unlimited overpayments.
Check your mortgage offer for the 'Early Repayment Charge' (ERC) section. The 10% per year cap on fixed-rate deals is industry-standard but a few lenders vary it — some reset on each anniversary, others on a calendar year basis.
Overpayments either reduce the term (keeping monthly payments the same) or reduce the monthly payment (keeping the term the same). Reducing the term saves more interest over the life of the loan.
ERCs typically taper from around 5% in year 1 down to 1% in the final year of a 5-year fix. After the deal ends, overpayments are usually unlimited.
Primary source: fca.org.uk MCOB