Owning your own home

Yeah cheers, I did the maths and 10% would be a pretty steep overpayment. Reckon we'll manage 5% though.

The overpayment limit is generally 10% of the outstanding mortgage balance at the start of the calendar year, not 10% of the principal every year. (It will depend on your mortgage provider though, worth checking.)

So year 1 you pay back 5% of the outstanding sum but by the start of year 5 you've paid back at least 20% of the original sum which means your overpayments will be 5/80 = 6.25%

Paying back 7% a year is roughly where you'd get into trouble in the 5th year (assuming that's the limit for ERCs): 7 / (100-(4*7)) = 9.72%

I'm going to run into this problem as I'm on an interest-only mortgage (5 year fixed and I've got 10 years left in total) but it's manageable by sticking excess into savings and dumping that into the mortgage when I renegotiate in 5 years (and I'll make sure I get something that has suitable early repayment charge terms or something like an offset mortgage for those final 5 years).