Making Overpayments On Your Barclays Mortgage: A Guide

Making overpayments on your Barclays mortgage can help you pay it off sooner and save you money overall. You can make overpayments by increasing your Direct Debit or standing order, or by making an additional payment each month. If you've missed any payments, you should call Barclays before making overpayments. It's important to note that making overpayments won't change your mortgage term, and you won't be refunded for any overpayments. If you're considering making overpayments, it's recommended to review your mortgage offer and contact Barclays for specific guidance.

Barclays' overpayment rules

Barclays Overpayment Rules

Barclays allows mortgage customers to make overpayments and lump-sum repayments, which can help to reduce the total cost of the mortgage and pay it off sooner. However, there are certain rules and limits to be aware of when making overpayments.

Firstly, it is important to note that overpayments will not change the original mortgage term. This means that you will still be expected to pay off your mortgage over the initially agreed-upon term. If you wish to change your mortgage term, you will need to contact Barclays directly. Additionally, Barclays will not refund any overpayments or lump-sum repayments.

When making overpayments, it is crucial to ensure that you are up to date with your regular monthly payments. If you have missed any payments or owe charges, you must contact Barclays before making overpayments.

In terms of the amount you can overpay, Barclays allows overpayments of up to 10% of the annual overpayment allowance. This typically equates to three times your usual monthly payment. For example, if your monthly payment is £1000, you can make a one-off payment of up to £3000 without incurring an early repayment charge (ERC). If you pay more than three times your monthly payment in a single month, it will be classed as a capital repayment and will reduce your overall mortgage balance.

You can make overpayments by increasing your Direct Debit or standing order, or by making additional payments each month. If you have multiple mortgages on a property, each one will have its own mortgage offer, account, and contractual monthly payment (CMP).

Lump-sum repayments

Making a lump-sum repayment on your Barclays mortgage can help you pay it off sooner and save you money overall. A lump-sum repayment is an additional mortgage payment that is at least three times your CMP (Contractual Monthly Payment). This may also be called a 'part redemption'.

Making a lump-sum repayment reduces the amount of interest you are charged, which means it will cost you less overall. Your CMP will normally reduce, as you will be repaying a reduced balance over the remainder of your original term. However, making overpayments or lump-sum repayments will not change your mortgage term. You will still be expected to pay off your mortgage over the term you originally agreed.

If you are switching your interest rate and want to make a lump-sum repayment without paying an early repayment charge (ERC), you can either make a lump-sum repayment equal to up to 90% of your mortgage balance between 90 and 31 days of your current rate ending, or make a lump-sum repayment of any amount within 30 days of your current rate ending. If you have missed any payments or owe charges on your mortgage, you should call Barclays before making overpayments or lump-sum repayments.

If you have a lot of money in your bank account, you may be able to pay off your mortgage in around 100 small transactions and pay no ERC. However, if you pay more than 3x your monthly repayment in any given month, this will be classed as a capital repayment and will reduce your overall mortgage balance. If the total of these payments is over 10% of your balance in a 12-month period, you will pay an ERC.

Underpayments

To set up an underpayment, log in to Online Banking and select 'Set up an underpayment'. You can then see your 'Pre-payment balance', which is the same as your overpayment account balance. You can also call Barclays on 0333 202 75041 to set up an underpayment. They are available Monday to Thursday from 8 am to 8 pm, Friday from 8 am to 6 pm, and Saturday from 9 am to 1 pm.

Making underpayments won't change your mortgage term. You will still be expected to pay off your mortgage over the term you originally agreed.

Early repayment charges

However, before making any overpayments or lump-sum repayments, it is important to check if you have missed any payments or owe any charges on your mortgage. If so, you should contact Barclays to discuss your options.

The amount of the early repayment charge depends on the type of mortgage you have. To check your early repayment charge, you can select your mortgage type from the list of accounts on the Barclays website and then choose the "Get a settlement amount" option.

If you are switching your interest rate and want to make a lump-sum repayment without paying an ERC, there are a couple of options. You can make a lump-sum repayment of up to 90% of your mortgage balance between 90 and 31 days of your current rate ending, or you can make a lump-sum repayment of any amount within 30 days of your current rate ending.

Online or phone payments

If you're looking to make an overpayment on your Barclays mortgage, you can do so online or over the phone.

First, it's important to note that making overpayments won't change your mortgage term. Barclays will still expect you to pay off your mortgage over the term you originally agreed upon. Additionally, Barclays will not refund any overpayments, so it's important to plan accordingly.

If you have missed any payments or owe charges on your mortgage, you must call 0800 022 40221 before making overpayments. This phone line is open Monday to Friday, from 8:30 am to 5:30 pm, and from 9 am to 1 pm on Saturdays.

If you have a mortgage account number that is 10 digits long, you can make overpayments online by logging into your Online Banking account and starting a web chat. This service is available Monday to Friday, from 7 am to 8 pm (except bank holidays), and from 7 am to 5 pm on weekends.

If you'd prefer to make overpayments over the phone, you can call 0333 202 75801. This line is also open Monday to Friday, from 7 am to 8 pm (except bank holidays), and from 7 am to 5 pm on weekends.

When making overpayments, it's important to be mindful of any early repayment charges (ERCs) that may apply. Barclays considers anything repaid over three times your monthly repayment in any given month as a capital repayment, which will reduce your overall mortgage balance. However, if the total of these payments exceeds 10% of your balance in a 12-month period, you may be subject to an ERC.

Frequently asked questions