Mortgage overpayment calculator (UK)

Discover the impact an overpayment could have on your mortgage with a simple and convenient online mortgage overpayment calculator.

What is a mortgage overpayment?

You may, at some point within your mortgage term, be in the position to make an overpayment on your mortgage.

Your mortgage deal with your lender includes monthly mortgage payments, and the amount will depend on the type of mortgage you have, the amount you’re borrowing and the agreed term of your mortgage.

A mortgage overpayment is simply a matter of paying more than your required monthly amount.

To do this, you might choose to:

  • Make a payment to your lender in one single lump sum
  • Increase your monthly payment amount for ongoing overpayment
  • Combine both options 1 and 2

Why make an overpayment on your mortgage?

Overpayments on your mortgage can save you money and time in the long run, as well as give you greater flexibility in relation to your monthly mortgage payments.

But they can also come with repayment penalties if you’re not careful, so it’s worth doing your research before you decide to make an overpayment.

As with all of these important decisions, it very much depends on your own situation. Let’s take a closer look at the positives and negatives of making an overpayment on your mortgage.

What are the benefits of making overpayments on your mortgage?

As with any form of loan, paying it off earlier than necessary often comes with its benefits.

It reduces the amount that you owe on your mortgage

Any overpayment you make goes directly towards the amount you owe your mortgage lender. This also means you cut down on the time it will take to to repay your mortgage.

It reduces the amount of interest on your mortgage

As interest is calculated on your outstanding amount, by reducing the amount you owe your mortgage lender, you’re also lowering the interest payable on your remaining mortgage payments.

It gives you more flexibility for the future

By overpaying on your mortgage now and reducing the amount you owe, you’re giving yourself flexibility for future scenarios where you might want to pay less – when, for example, you decide to expand your family or take on other loans.

If you decide to make an overpayment on your mortgage, your next step would be to check that your lender offers this service. If they do, you should get in touch with them and arrange the best way to make the payment. Your mortgage lender will be able to give you advice on how to calculate overpayments on your mortgage.

These options vary from lender to lender. With some, you’ll be able to arrange it all online, while others might require some additional steps. Likewise, how much you can overpay by will depend on their terms and conditions.

Overpayments on your mortgage come with many benefits, but there are a few things you should be aware of before deciding to make one.

Important considerations before making an overpayment

The most important question to consider before making an overpayment is whether your lender will charge an Early Repayment Charge (ERC).

Depending on the deal you secured from your lender, there might be:

  • No fee at all
  • A fee for paying more than a certain amount (for example, 10% above the regular monthly payment)
  • A fee regardless of the amount overpaid

If they do charge a fee, it may outweigh the benefits of making an overpayment. So be sure to look into this with your lender or mortgage broker before making your overpayment.

You may also want to consider whether:

  • You have other, more pressing debts worth clearing first
  • You ought to focus on building up your savings
  • You plan to remortgage at a later date (overpayments may affect your loan-to-value ratio, opening up better mortgage options)
  • You can pull back on your overpayment at a later date

As with any decision relating to your mortgage, we recommend making sure you have all the necessary information you need to go into the decision fully informed.

Using a mortgage overpayment calculator

Some mortgage calculators work out how much interest you’ll save by making an overpayment. Others show you the reduced mortgage debt, a new time period and how much you’ll pay monthly.

With a mortgage repayment calculator for overpayments, you’ll get a better understanding of the impact an overpayment will have on the total cost of your mortgage.

Before getting started, be sure to check if your lender charges an early repayment fee, and if they do, how much it is. Other information you’ll need to provide includes:

  1. the current amount you owe on your mortgage
  2. the remaining length of time on your mortgage
  3. your mortgage type
  4. the amount you plan on increasing your monthly payments by, or the value of your lump sum payment

Once you have that information ready, you'll be able to find out what impact your overpayment could have on your mortgage.

Frequently asked questions

Where can I find a mortgage overpayment calculator?

A number of mortgage lenders have their own mortgage overpayment calculator version available on their website, so it might be useful to check if yours has one before visiting a third party site. These include (but aren’t limited to):

  • Halifax mortgage overpayment calculator
  • HSBC mortgage overpayment calculator
  • Nationwide mortgage overpayment calculator
  • Natwest mortgage overpayment calculator
  • Santander mortgage overpayment calculator
  • Barclays mortgage overpayment calculator
  • RBS mortgage overpayment calculator
  • Lloyds mortgage overpayment calculator

You can also find mortgage overpayment calculators on consumer finance information websites: Money Saving Expert has a mortgage overpayment calculator, for instance.

Is there an interest only mortgage overpayment calculator?

If you’ve opted for an interest only mortgage you’ll only be paying off the interest on your mortgage.

To make overpayments on this mortgage type, discuss the available options with your mortgage lender and check how much you can pay without incurring penalties.