Mortgage Overpayment Calculator — Interest & Time Saved
Overpaying your mortgage pays down the outstanding balance faster, so less interest is charged every month and the loan clears years sooner. Enter your details below to see, in pounds (£), exactly how much interest and time a regular monthly overpayment could save you.
Calculate your overpayment savings
How mortgage overpayment works
A repayment mortgage is structured so that each monthly payment covers the interest charged on your outstanding balance plus a slice of the capital you borrowed. In the early years most of your payment goes on interest, because the balance is high. When you make an overpayment, every extra pound goes straight onto the capital. That permanently lowers the balance, so the interest charged in every following month is smaller — and because less of your normal payment is then needed for interest, more of it chips away at the capital too. The effect compounds, which is why even modest regular overpayments can shave years off the term.
Worked example
Suppose you owe £200,000 at 5% over a remaining 25 years. The standard monthly payment is about £1,169, and over the full term you would pay roughly £150,800 in interest. Now add a £200 monthly overpayment. The mortgage clears in about 20 years and 8 months instead of 25 years — over 4 years early — and total interest falls to around £123,000, a saving of roughly £28,000. Adjust the figures above to model your own mortgage.
Frequently asked questions
Is it better to overpay my mortgage or save the money?
If your mortgage interest rate is higher than the after-tax return you could earn on savings or investments, overpaying usually wins because it gives a guaranteed, tax-free saving. However, clear expensive debts (credit cards, overdrafts) first and keep an accessible emergency fund before overpaying.
How much can I overpay without a penalty?
Most UK fixed and discounted deals allow you to overpay up to 10% of the outstanding balance each year penalty-free. Standard variable rate (SVR) mortgages and trackers without an early repayment charge often let you overpay without limit, but always confirm with your lender.
Should I reduce the term or the monthly payment?
When you overpay, ask your lender to keep the term the same and reduce the balance — this maximises interest saved, as shown by this calculator. Alternatively you can ask to shorten the term, which raises your contractual payment but locks in the discipline. Reducing the monthly payment saves the least interest.
Does a lump-sum overpayment save more than monthly overpayments?
A lump sum paid early saves the most interest because it reduces the balance sooner. Regular monthly overpayments are easier to budget and still produce large savings over the life of the loan. The best choice depends on your cash flow and your lender's annual overpayment allowance.
Will overpaying affect my ability to remortgage?
No — overpaying lowers your loan-to-value ratio, which can actually unlock better remortgage rates. Just be mindful of annual overpayment limits and early repayment charges if you plan to remortgage or move during a fixed period.
Related Calculators
- Mortgage Calculator — estimate your full monthly payment.
- Amortization Calculator — see the month-by-month breakdown of capital and interest.
- Loan Calculator — work out repayments on any loan.
Last reviewed: June 2026. Estimates only; your lender's figures will reflect their own terms, rounding and current rates.