How an overpayment reserve works

An overpayment reserve allows you to do a number of things, depending on when you took out your current mortgage deal.

You could:

  • pay off your mortgage earlier
  • underpay on your mortgage.

With some of our mortgages, taken out before March 2010, your overpayments could be borrowed back.

The overpayment reserve and your Loan To Value

When borrowing more, the overpayment reserve is also used in our calculations for working out your Loan To Value (LTV).

For example, the mortgage balance on your account says £90,000. This includes an overpayment reserve of £10,000. So we recognise your balance to be £100,000.

We do this because we could allow you to underpay or borrow back the £10,000 you’ve overpaid at any time. This depends on your mortgage deal terms and conditions.


The Loan to Value (LTV) is the percentage of borrowing you take out against your home.

For example, if you have a mortgage of £150,000 and your home is worth £200,000, you have an LTV of 75%. 


Some of our mortgages have limits, known as an overpayment allowance, on how much you can overpay.

Contact us

Over the phone

To discuss the impact of giving up your overpayment reserve, call us

Monday to Friday, 8am to 6pm.
Saturday 9am to 2pm.
Closed Sundays and bank holidays.