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Mortgage overpayment calculator
What an extra monthly payment or one-off lump sum does to your term and the total interest you pay.
Your contractual payment works out at £1,111.66 a month. Most lenders allow 10% of the balance in overpayments a year without early repayment charges; check yours.
Interest saved
£21,142
Mortgage-free 3y 6m earlier
- Term without overpaying25 years
- Term with overpaying21y 6m
- Interest without overpaying£133,499
- Interest with overpaying£112,358
Overpaying beats saving when your mortgage rate is higher than your savings rate, after tax. Expensive debt first though: clear that before overpaying here.
Common questions
- Is it worth overpaying my mortgage?
- If your mortgage rate is higher than what your savings earn after tax, overpaying gives a guaranteed, tax-free return at your mortgage rate. If your savings rate beats your mortgage rate, saving wins mathematically. Clear expensive debt (credit cards, overdrafts) before either.
- How much can I overpay without penalty?
- Most fixed-rate deals allow overpayments of 10% of the outstanding balance per year without early repayment charges. Tracker and standard variable rate mortgages are often unlimited. Check your own deal's terms; an early repayment charge can wipe out years of interest savings.
- Should I overpay monthly or save up a lump sum?
- Mathematically, money paid off earlier saves more interest, so regular monthly overpayments edge out saving up for a lump sum at the same total. The difference is small; consistency matters more than the method.
- Should I overpay or shorten the term instead?
- Overpaying voluntarily has the same interest effect as a shorter term but keeps flexibility: you can stop if money gets tight. Formally reducing the term locks in the higher payment. Most people are better served by the flexible route.
- Should I overpay my mortgage or pay into my pension?
- Pension contributions get tax relief and possibly an employer match, which is usually a bigger instant return than mortgage interest saved. The common order: full employer match first, expensive debt, emergency fund, then weigh extra pension against overpaying based on your rate and your need for flexibility.
Not sure overpaying is your best move? The Money Health Check ranks it against everything else.