Owning your own home

I dont see why you'd voluntarily pay the early repayment fee, you can probably pay 10% a year without a fee then make a long term decision at the end of the fixed rate.

Because £11k in ERC fees is about 5 months of the interest payments of those mortgage payments. That's a lot cheaper than waiting 4 years to be able to pay it off without ERC, even with paying 10% a year ERC-free.

The only time to consider delaying a lump sum payment is if it is about to fall across the boundary of some ERC-free payments. e.g. if you wanted to pay off a lump in December and your new ERC-free overpayment window opened in January then you'd look at paying as much as you could ERC-free in December, and then paying the rest in January - using the following year's ERC-free allowance.

(Any bulk payment you make to the mortgage company will have the current year ERC-free allowances taken into account.)

I've done the calcs on paying my own mortgage off (I owe £200k but my existing mortgage only has 4.5 years left on it, luckily it is interest-only.) It's cheaper to just throw money at our 2% ERC even after I've used up the 10% ERC-free allowance I have each year.

(I'm not going to repay all £200k in the next 4.5 years without some windfalls of my own, but I'll be a lot lot closer to paying it off and I'll be able to remortgage for another 10 years or so when the current mortgage is up. Repaying it faster will depend on how much I and Mrs GB earn and how long she continues to work as she's hoping to retire in the next 10 years - I'm 9 years younger so I can go on a bit longer.)

Back to the OP, the only reason for not going for #1 is if you think there's a risk to your health/employment/etc that may stop you being able to pay it off quickly in the next 2.5 years.