Early repayment charge (ERC)
Cards & borrowingA fee for paying off a mortgage or loan early during a fixed period.
Overview
ERCs compensate lenders for lost interest.
They can be a percentage of the balance or a set amount.
Why it matters
- It can make switching deals expensive.
- It affects whether remortgaging saves money.
- It should be considered before overpaying.
FAQs
Are ERCs the same as exit fees?
No. ERCs apply during a deal period; exit fees apply when closing.
Can I avoid ERCs?
Some lenders allow limited overpayments without charges.
Related terms
Take control of your credit health
Get the complete credit toolkit — all features included.
Start building creditInstant setup. No credit check. Cancel anytime.