Lloyds Banking Group is inviting its standard variable rate (SVR) mortgage customers to increase their monthly payments.
The new scheme will encourage customers to pay off their mortgages early and will allow them to overpay by up to 20 per cent without receiving a penalty.
Of the bank's mortgage customers, 63 per cent would consider overpaying, or upping their existing overpayment, if they did not incur a financial penalty, research by Lloyds discovered.
The group's commercial director of mortgages Stephen Noakes said: "With mortgage rates at an historic low, there has never been a better time for the majority of people to overpay their mortgage."
Mr Noakes points out that the average mortgage repayment has fallen by about £188 per month, allowing customers to gain maximum advantage from the extra cash they have.
In addition to announcing its mortgage overpayment scheme, the organisation is also reported to be looking into a possible demerger of part of its depressed commercial property arm into a tax-efficient investment trust.
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