Early repayment charges (ERC) guide
An ERC is what you may pay for leaving a deal early — fully or partly. It is one of the biggest swing factors in remortgage timing.
Updated UK · illustrative onlyNot a lender or brokerAboutDisclaimer
RLPublished by Rodway Labs — not a mortgage adviser
Published
Common methods
- Percentage of balance: e.g. 2% of the amount redeemed. Often stepped (higher in year 1, lower later).
- Months of interest: e.g. a charge equal to one or more months’ interest at your current rate.
Worked example (illustrative)
Balance £200,000, ERC 2% of balance on full redemption: estimated charge = £4,000. If you only overpay £20,000 and the charge applies to the excess above an annual allowance, the ERC is typically calculated on the excess — not the whole balance. Always read your offer.
Estimate with the ERC estimator, then fold the figure into the true cost calculator.
This page does not cover every lender’s schedule. Cashback clawback can apply separately from ERC.
Related
Calculators and articles on Remortgage Lab are illustrative and not personalised financial advice. Always check current lender terms and, where appropriate, speak to an FCA-authorised adviser. England & Northern Ireland focus where tax rules are cited; Scotland and Wales differ.