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Property · Amortisation

Mortgage Overpayment Calculator

Overpaying chips capital off your balance directly — every £1 paid early saves you years of interest. This is one of the highest risk-free returns most UK households can get.

£
%
yrs
£
£

Interest saved

£41,843

Paid off 6y 2m earlier — new term 18y 10m.

Comparison

  • Original monthly payment
    £1,169
  • Original total interest
    £150,754
  • New total interest
    £108,911
  • Saved
    £41,843

How we calculated your result

We simulate the original amortisation, then re-simulate with the extra payments applied each month and the lump sum deducted immediately. Interest saved = original total interest − new total interest.

Official UK rules in simple English

  • Most fixed-rate UK mortgages allow up to 10% of the outstanding balance per year as a penalty-free overpayment.
  • Variable-rate / tracker mortgages usually have no overpayment cap.
  • Early Repayment Charges (ERCs) typically range 1–5% on a fixed deal.

Common pitfalls to watch out for

  • ⚠ Tell your lender to reduce the term, not the payment

    By default many lenders keep the term and just lower future payments. You save less interest. Always specify ‘reduce term’.

  • ⚠ Watch the 10% allowance

    Going £1 over can trigger an ERC on the entire overpayment. Track the calendar year.

  • ⚠ Compare with savings rates

    If your mortgage is 4% and your easy-access savings pay 5% (after tax), saving wins. Overpay only when mortgage rate > net savings rate.

Frequently asked questions

Lump sum or monthly?
Lump sum saves more interest (capital reduced immediately). Monthly is more disciplined.
Does this affect my LTV?
Yes — overpaying drops your balance, lowering LTV, which can unlock better rates at remortgage.

Illustrative. Check your mortgage deal for ERCs before overpaying significantly.

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