The mutual said this was a more generous allowance than the typical 10% overpayment limit across the market, and would give borrowers the freedom to reduce their mortgage balance faster.
Vernon Building Society’s discounted variable mortgages offer lower rates than its standard variable rate (SVR), which is currently 7.85%. Borrowers can access loans from £100,000 or £50,000 for properties in Greater Manchester and Cheshire, where the mutual is based.
Brendan Crowshaw, head of mortgage and savings distribution at Vernon Building Society, said: “Discounted variable rate mortgages are often overlooked in favour of fixed rate deals, but they can offer real value, particularly in an environment where interest rates are expected to fall. They are competitive, flexible and a smart choice for borrowers who want to make overpayments.
“Our 25% capital repayment allowance, without penalty, is very competitive and designed to help customers take greater control of their mortgage.”
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Virgin Money lowers rates
Virgin Money has reduced select mortgage rates and added a free valuation incentive to all new purchase applications.
Changes have been made to its exclusive purchase, purchase, exclusive remortgage and buy to let (BTL). The lender will also withdraw its flexible tracker product transfer deals with a £995 fee at 65%, 75% and 85% loan to value (LTV).
Rate reductions include its two-year fixed exclusive purchase products at 80% LTV, which will start at 4.33%, following cuts of up to 0.09%.
Within the same range, select Fix and Switch rates will be cut by up to 0.11% and start from 4.79%.
Virgin Money has reduced rates on its five-year fixed Retrofit Boost products with a £995 fee by 0.02% for both remortgage and purchase.
Additionally, the lender has cut two- and five-year fixed rates by up to 0.15% across its £1m-plus range at 75% LTV, and selected Own New two- and five-year fixed rates by as much as 0.15%.
Changes will take effect from 17 April and come shortly after some rate increases at the start of this month.
