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@Greenbank
Similar. Just called Santander, it's 10% of the balance on Jan 1st of each year.
If, in August, we continue with them for another interest-only[1] 5 year fixed deal (I'm risk averse and Brexit looms) then it's looking like about £1100 in early repayment charges in those 5 years. Wondering if that is worth it or if there is a cleverer way to do it...
(Since the ERC is 5% that represents £22k's worth of extra repayments, roughly 10% of the current outstanding balance, average monthly interest payment in that period will be about £300, so I'd be saving ~£15 a month [half of 10% of the monthly interest payment]. £15/month * 5 years = £900. That's close enough for me. £1100 over 5 years is a pint a week, so not silly money. I can also front load each year to avoid some of the ERCs and put the other contributions in shortish term investments ready for a bigger front load for the subsequent year... )
It definitely doesn't work for the last 5 years though (£3.5k ERCs on £120k by my calcs), but I've got almost 6 years to think about that.
Nice to think of a time when the mortgage will be paid off, but that coincides almost exactly with the September that my daughter would (theoretically, counting chickens, etc) be off to uni and anything can happen in the next 10 years (i.e. moving house and borrowing more).