Precision Utility
Mortgage Overpayment
Calculator
10% Rule
ERC Free
Avg Savings
£30k+
Find out how much you could save by overpaying your mortgage. Enter your current balance, interest rate, remaining term and overpayment amount — the calculator shows you the interest saved, time knocked off your mortgage and your new payoff date. Compare reducing your term versus reducing your monthly payment to find the best strategy for you.
Overpayment Details
Early Repayment Charges
Most UK lenders allow up to 10% overpayment per year without early repayment charges (ERCs). Overpaying beyond this limit during a fixed rate period typically incurs a charge of 1–5% of the excess amount. Check your mortgage terms before making large overpayments.
Interest Saved
£0
Time Saved
0 months
New Payoff Date
—
Original Total Cost
£0
New Total Cost
£0
Current Monthly
£0
New Monthly (with overpayment)
£0
How the mortgage overpayment calculator works
Enter your current mortgage balance, interest rate and remaining term. Then add a monthly overpayment, a one-off lump sum, or both. The calculator runs two amortisation schedules side by side — one without overpayments and one with — so you can see exactly how much time and money you save.
Choose between two strategies. Reduce term keeps your current monthly payment the same but adds your overpayment on top, so you finish your mortgage sooner. Reduce payment recalculates your monthly payment over the same term but with the lower balance, giving you smaller bills each month.
The lump sum is applied immediately to your outstanding balance before the monthly overpayment schedule begins. This means interest starts accruing on a smaller amount straight away, maximising your savings.
Results update automatically as you adjust the sliders. The year-by-year comparison table shows exactly how your balance reduces compared to the original schedule.
What you need to know about overpaying your mortgage
Overpaying your mortgage is one of the most effective ways to reduce the total cost of your home loan. Every pound you overpay goes directly toward reducing your outstanding balance, which means less interest accrues in future months — a compounding effect that grows over time.
Key points for UK mortgage holders:
- Most lenders allow up to 10% overpayment per year without early repayment charges (ERCs)
- ERCs typically range from 1% to 5% of the overpaid amount and usually apply only during fixed or discounted rate periods
- Once you move to your lender's standard variable rate (SVR), there are generally no penalties for overpaying any amount
- Some lenders offer an "offset mortgage" where savings reduce the interest charged without technically overpaying
- Overpaying is generally better than saving if your mortgage rate exceeds your savings rate (after tax)
Before overpaying, make sure you have cleared any higher-interest debts (credit cards, personal loans) and have an emergency fund of 3–6 months' expenses. If your mortgage rate is below what you can earn in a savings account after tax, it may be more efficient to save rather than overpay.
Frequently asked questions
How much can I overpay my mortgage without penalty?
Most UK lenders allow you to overpay up to 10% of your outstanding mortgage balance each year without incurring early repayment charges. This limit typically resets on the anniversary of your mortgage deal. Always check your specific mortgage terms, as some lenders offer higher allowances.
Should I overpay my mortgage or save?
If your mortgage rate is higher than the interest you earn on savings (after tax), overpaying your mortgage generally saves you more money. However, you should keep an emergency fund of 3–6 months' expenses before overpaying. If your savings rate exceeds your mortgage rate, saving may be the better option.
Does overpaying reduce my term or monthly payment?
It depends on your lender and your preference. Most lenders default to reducing your term (keeping payments the same), which saves the most interest. Some allow you to reduce your monthly payment instead (keeping the term the same). Use the toggle in this calculator to compare both options.
What are early repayment charges on a UK mortgage?
Early repayment charges (ERCs) typically range from 1% to 5% of the amount overpaid beyond your annual allowance. They usually apply during your fixed or discounted rate period. Once you move to your lender's standard variable rate, ERCs generally no longer apply.
How much interest will I save by overpaying my mortgage?
The interest saved depends on your balance, rate and overpayment amount. For example, overpaying £200 per month on a £200,000 mortgage at 4.5% over 25 years could save you over £30,000 in interest and cut roughly 6 years off your term. Use the calculator above for your exact figures.
When should I not overpay my mortgage?
Avoid overpaying if you have higher-interest debts like credit cards or personal loans — clear those first. You should also avoid it if you don't have an emergency fund, if your mortgage rate is very low compared to savings rates, or if the early repayment charges outweigh the interest savings.
Can I make a lump sum overpayment on my mortgage?
Yes, most UK lenders accept lump sum overpayments alongside regular monthly overpayments. The same 10% annual allowance typically applies to the total of all overpayments combined. A lump sum immediately reduces your outstanding balance, which means less interest accrues from that point forward.