How does overpaying a mortgage save money?

Overpayments come straight off the outstanding balance, so you are charged interest on a smaller amount every month afterwards. That compounds - each overpayment saves interest for the whole remaining term, which is why even modest regular overpayments can knock years off and save thousands.

Is a lump sum or a regular overpayment better?

Both help; earlier is better because the saving compounds for longer. A lump sum today removes interest on that amount for the entire remaining term. A regular monthly overpayment builds the same effect steadily. This calculator lets you model either or both together.

Are there limits on overpaying?

Many fixed-rate mortgages allow penalty-free overpayments of up to 10% of the balance a year; above that an early repayment charge (ERC) may apply. This calculator shows the interest maths only - check your lender's overpayment allowance and any ERC before overpaying.

Mortgage Overpayment Calculator 2026

See how much interest you save and how many years you cut off your mortgage by overpaying - a regular monthly extra, a one-off lump sum, or both. Enter your outstanding balance, rate and years remaining. See also: mortgage repayment calculator.

Cite or embed - free under CC BY 4.0

Frequently asked questions

How does overpaying a mortgage save money?: Overpayments come straight off the outstanding balance, so you are charged interest on a smaller amount every month afterwards. That compounds - each overpayment saves interest for the whole remaining term, which is why even modest regular overpayments can knock years off and save thousands.
Is a lump sum or a regular overpayment better?: Both help; earlier is better because the saving compounds for longer. A lump sum today removes interest on that amount for the entire remaining term. A regular monthly overpayment builds the same effect steadily. This calculator lets you model either or both together.
Are there limits on overpaying?: Many fixed-rate mortgages allow penalty-free overpayments of up to 10% of the balance a year; above that an early repayment charge (ERC) may apply. This calculator shows the interest maths only - check your lender's overpayment allowance and any ERC before overpaying.

Other UK tax calculators that pair with the Overpayment.

Frequently asked questions

Related calculators