Mortgage Charter

Why should I switch to a new mortgage deal?

If you have a fixed rate mortgage with us, your payment is set at a specific interest rate for a certain amount of time. This means whilst your mortgage is fixed, your payments will stay the same, which can be good for budgeting. As your payments will stay the same it also means you won’t benefit if the Bank of England Base Rate or our Standard Variable Rate goes down.

When your fixed period ends, your mortgage will go on to a variable interest rate. This rate will link to the Bank of England Base Rate or our Standard Variable Rate, so if the rate your mortgage links to goes up or down, so will your payments.

You can apply for a new fixed rate if you’re within four months of your current mortgage deal ending. The new rate will take affect when your current deal ends.

You may also apply if you’re already on a variable rate depending on the terms of your mortgage.

Can I switch my deal and temporarily switch my mortgage to interest only at the same time?

It’s not possible to make both changes at the same time. You can switch your deal up to four months before your fixed rate ends or if it’s already ended. You’ll need to apply to switch your deal first – then once you’ve made a payment on the new rate, you can apply to temporarily switch your mortgage to interest only.

To work out how much your interest only payments might be on a new rate:

• See what rates you can choose from using the rate links below
• Open the interest only calculator
• Enter your mortgage details. In the answer field for What is your current mortgage interest rate?, tell us the interest rate you want to switch to
• You can try different interest rates to see which one is best for you.

How do I know what mortgage deals are on offer?

Take a look at our rates to see what’s available. These can be withdrawn at any time, without notice. Use our calculator to work out how switching to a new deal could affect your monthly payment.

Calculate payments

How do I apply to switch to a new mortgage deal?

You can apply for a new deal:

• With a recommendation. We’ll fully assess your circumstances and suggest a deal that we think suit your needs
• Without a recommendation. We won’t make any assessment and you’ll choose a deal which you think is best for you. Please read our Execution Only Disclosure (PDF) for more details.

You could talk about your options with a mortgage broker instead if you prefer.

We can withdraw our mortgage deals at any time and without notice.

Apply now

What if I’ve applied to switch my deal and a better one becomes available?

You can change your deal or cancel your request up to two weeks before your new rate is due to start. However, we recommend you contact us by the 1st of the month before your new deal is due to start to make sure we can set it up in time. Just get in touch to let us know.

We can withdraw our mortgage deals at any time and without notice.

What does a switch to interest only mean under the Mortgage Charter?

You should continue to make your current mortgage payments if you can afford to. Temporarily switching to interest only will cost you more in the long run.

You can apply for a switch to interest only for six months if you want help with your residential mortgage payments and:

• You have at least one year left until you pay off your mortgage
• All or part of your mortgage is on repayment
• You’ve made your first mortgage payment
• Your account isn’t in arrears.

Switching to interest only payments means that your monthly payment will be lower as you’ll only pay the interest charged on your mortgage balance (the capital). Your balance will stay the same during this time.

At the end of the six months, your mortgage will automatically go back on to repayment. Your payments will be higher than before as it will include the capital that you didn’t pay when your mortgage was on interest only. We’ll spread this over how long you have left to pay off your mortgage.

The interest you’ll pay back overall will also be more, so the total cost of your mortgage will be higher.

We don’t recommend which support under the Mortgage Charter is best for you.

You should think about switching to a new mortgage deal if you’re on a variable rate or a fixed rate that’s due to end within the next four months.

Can I temporarily switch my mortgage to interest only and switch to a new deal at the same time?

It’s not possible to make both changes at the same time. You’ll need to apply to switch to a new deal first – then once you’ve made a payment on the new rate, you can apply to temporarily switch your mortgage to interest only once you’ve made a payment on the new rate.

To work out how much your interest only payments might be on a new rate:

• See what deals you can choose from using the rate links on the switching tab
• Click on ‘Calculate payments’ below to open the interest only calculator
• Enter your mortgage details. In the answer field for What is your current mortgage interest rate?, tell us the interest rate you want to switch to
• You can try different interest rates to see which one is best for you.

How much would a temporary switch to interest only cost me?

We recommend using our calculator to understand how a switch to interest only for six months could affect your mortgage.

Calculate payments

How do I apply?

You can only apply directly through us. Choose one of the following:

1. Send us a request online.
   
   Apply online

 

2. Send us a request by post.Please read our Execution Only Disclosure (PDF) before completing the form. It explains what it means to request a change to your mortgage without any recommendation from us.
   
   Download form

   Don’t have a printer? Don’t worry. You can ask us to post you one. Please allow up to five working days to send you the form.

What happens if I still struggle to make payments during or after the interest only period?

You should contact us straight away. Visit our help and support page for details.

What does extending my term mean under the Mortgage Charter?

A mortgage term is the length of time you have your mortgage for. Under the Charter, you can have your mortgage for longer if this means you have enough money to make your payments.

You should continue to make your current mortgage payments if you can afford it. A term extension will cost you more in the long run.

Extending your term will make your monthly payment lower as it will take you longer to pay off your mortgage. It also means you’ll pay more interest overall so the total cost of your mortgage will be higher.

You can apply to extend your term if you want help with your residential mortgage payments and:

• Your mortgage is on a repayment basis. This is because your payment wouldn’t change if it were on interest only
• You’ve made your first mortgage payment
• Your account isn’t in arrears.

Some things to be aware of:

• We’ll change the term for both your accounts if you have a mortgage that’s on part interest only and part repayment basis. Your interest only payments will stay the same
• You can extend your current term up to 35 years from the date your mortgage started
• The new term must not take the eldest borrower past 75 years of age or their expected retirement age, whichever is earlier.

We don’t recommend which support under the Mortgage Charter is best for you.

You should think about switching to a new mortgage deal if you’re on a variable rate or a fixed rate that’s due to end within the next four months.

Can I reduce my term again in the future?

Under the Charter, you can choose to go back to your previous term within the first six months. There will be no affordability checks and your credit score won’t be negatively affected. Your payments will be higher than before as you’ll have paid less off your mortgage balance during the extension period.

You’ll need to tell us if you want to change your term back. You can message us from your hub or call us on 0345 300 8000*.

We’ll need to make sure your payments are still affordable if you want to reduce your term after the first six months. We’ll assess your circumstances and carry out a soft credit check, which won’t affect your credit score.

How much would a term extension cost me?

We recommend using our calculator to understand how a term extension could affect your mortgage. You can enter different term lengths to see which term is most suitable for you.

Calculate payments

How do I apply?

You can only apply directly through us. Choose one of the following:

1. Send us a request online.
   
   Apply online

 

2. Send us a request by post.Please read our Execution Only Disclosure (PDF) before completing the form. It explains what it means to request a change to your mortgage without any recommendation from us.
   
   Download form

   Don’t have a printer? Don’t worry. You can ask us to post you one. Please allow up to five working days to send you the form.

• Can I apply for more than one of the support measures under the Mortgage Charter?

  You can apply to switch your mortgage rate up to four months before your current deal ends. You may apply if you’re on a variable rate too, depending on the terms of your mortgage.

  If your current fixed rate is due to end soon, and you have a:

  • Temporary switch to interest only in place – you can apply for a new deal once you’ve made one month’s payment after your temporary interest only period has ended
  • Term extension in place – you can apply for a new deal once you’ve made your first payment on your new term.

  Other things to be aware of when applying for a temporary switch to interest only payments or term extension:

  • You can only apply for each option once
  • You must submit separate requests if you want to take advantage of both options
  • You must make one month’s normal payment between ending one option and starting the other. For example, if you’ve had a temporary switch to interest only for six months, you’ll go back to repayment in month seven. You must make this payment before you can have a term extension
  • You should read how each option could affect you. We don’t recommend which is best for you. You can talk this through with a mortgage broker if you’re not sure.

• How will using one of the Mortgage Charter measures affect my credit record?

  None of these measures will negatively affect your credit score. Once your request is in place, we’ll let the credit agencies know about your new monthly payment and switch to interest only or change of term. You’ll see these changes on your credit record one month after they’ve been made. If you temporarily switch your mortgage to interest only, we’ll update your credit record when it switches back to repayment.

• My account is already in arrears what can I do?

  You won’t be able to apply for help under the Charter, but we do already have support available. The earlier you contact us the sooner we can get you back on track.

  We have an experienced team who deal with borrowers facing financial difficultly. They’ll explore what choices you have and aim to find one suited to your needs.

  Visit our help and support page for more information or call 0345 300 8000* and select option 1.

• What happens if I fall into arrears after switching my rate or I’ve temporarily switch to interest only or extended my term?

  You’ll fall outside the Charter rules and will follow our standard arrears process. This means:

  • We’ll report the missed payments which will affect your credit score
  • We’ll follow our normal arrears process – we’ll send letters about the overdue payment(s) and try contacting you to talk about how we can help you to bring your account up to date using ways outside of the Charter
  • If you extend your mortgage term, you won’t be able to go back to your previous term without any affordability checks. This may also affect your credit score
  • If you apply for a temporary switch to interest only payments, your account will still revert to repayment after six months making your payments higher.

   

  You should get in touch as soon as you can if you fall into arrears so we can look at other ways we can help you. Call us on 0345 300 8000* and select option 1.

• Can I get Mortgage Charter support if I had my mortgage through a Help to Buy or NICHA (Northern Ireland Co-ownership Housing Association) scheme?

  You must obtain consent from Homes England or the NICHA scheme before applying for a temporary switch to interest only payments or a term extension.

• Can I get help under the Mortgage Charter if I’m letting my residential property out?

  You can only switch to a new deal if you apply for a Buy to Let mortgage. You and your property must meet our lending policy.

  You can apply for a temporary switch to interest only payments or a term extension if you have our approval to let out your property.

  If you don’t have our approval, visit our letting your residential property page. You’ll need our consent before we can put any help under the Charter in place.

• Can I get help under the Mortgage Charter if I’m living abroad?

  We’ll need to speak with you. Please get in touch.

• I’ve had help from you under the Mortgage Charter. Will changes to the Bank of England Base Rate or your Standard Variable Rate affect my payments?

  Depending on which of these rates your mortgage is linked to, your payments will still go up or down if you’re on a variable rate and you’ve had either:

  • A temporary switch to interest only for six months
  • An extension to your mortgage term.

  Your payments will stay as they are now if you have a fixed rate mortgage.

  You’ll find the details of your mortgage in your hub or in your most recent mortgage Offer.

* To call using text Relay, dial 18001 0345 300 8000 using a textphone or the Relay UK app. All calls are recorded for training and monitoring purposes. Lines are open 9am – 5pm Monday to Friday. We’re closed on Bank Holidays. 03 calls cost no more than calls to geographic numbers (01 or 02). Calls from landlines and mobiles are included in free call packages.