Vernon Building Society has announced a major enhancement to its discounted variable rate mortgage offering, raising the annual capital repayment limit to 25% without early repayment charges.

The move significantly outpaces the market norm of around 10%, marking a bid by the Stockport-based mutual to offer greater flexibility and financial control to borrowers.

The upgraded product feature applies across its discounted variable mortgage range, which typically offers interest rates lower than the lender’s standard variable rate for an initial period. Such products are often favoured by borrowers looking for lower monthly repayments and the ability to make overpayments without being locked into a long-term rate.

With this change, customers can now repay up to a quarter of their outstanding balance each year penalty-free, offering a level of freedom rarely seen in the market. The minimum loan size for the product is set at £100,000, though this threshold is halved to £50,000 for properties located in Greater Manchester and Cheshire, the society’s heartland.

Brendan Crowshaw (pictured), 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.”