Mortgage-Calc.uk
    Updated 7 August 2025

    Mortgage Early Repayment Calculator - Overpayment Savings

    Calculate the impact of mortgage overpayments on interest saved, time saved, and total cost. Includes penalty considerations and alternative investment comparisons.

    Overpayment Calculator

    Compare standard payments with overpayment strategies

    Current monthly payment:£1,265.299
    Remaining payments:240 months

    Overpayment Analysis

    5 years 5 months

    Time Saved

    £30,891.888

    Interest Saved

    14.6 years

    New Term

    Scenario Comparison

    Standard Payments
    Monthly payment:£1,265.299
    Term remaining:20 years
    Total interest:£103,671.701
    Total cost:£303,671.701
    With Overpayments
    Monthly payment:£1,565.299
    New term:14.6 years
    Total interest:£72,779.812
    Total cost:£272,779.812

    Total Savings

    Interest saved:£30,891.888
    Time saved:5 years 5 months
    Total overpayments:£52,500
    Net benefit:£-21,608.112

    Overpayment Strategy Recommendations

    Mortgage Overpayment Strategies

    When Overpaying Makes Sense

    • • High mortgage interest rates (above 5%)
    • • Low penalty charges or penalty-free periods
    • • Emergency fund already established (3-6 months expenses)
    • • No higher-interest debt (credit cards, personal loans)
    • • Conservative investment approach preferred
    • • Desire for debt-free status and peace of mind

    Overpayment Strategies

    • • Regular monthly: Consistent additional payments
    • • Annual lump sum: Use bonuses or tax refunds
    • • Rate change: Overpay when rates are low
    • • Offset mortgage: Link savings to reduce interest
    • • Flexible mortgage: Overpay and borrow back if needed

    When to Consider Alternatives

    • • High early repayment charges apply
    • • Better investment returns available (ISAs, pensions)
    • • Low mortgage rates (below 3-4%)
    • • Need for liquidity and flexibility
    • • Higher-rate taxpayer with pension contribution room
    • • Plans to move house within 2-3 years

    Tax Considerations

    • • Overpayments provide tax-free "return"
    • • Compare with taxable investment returns
    • • Higher-rate taxpayers may prefer pension contributions
    • • Consider ISA allowances for tax-free investing
    • • Capital gains tax on investment profits

    Overpayment Limits and Rules

    Typical Overpayment Allowances

    Fixed Rate Mortgages
    Usually 10% of outstanding balance per year
    Variable Rate Mortgages
    Often unlimited overpayments allowed
    Tracker Mortgages
    Typically unlimited overpayments

    Early Repayment Charges

    Typical Charges
    1-5% of amount overpaid above the limit
    When They Apply
    During fixed, discount, or tracker periods
    How to Avoid
    Stay within annual limits or wait for deal to end

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    Explore More Mortgage Options

    Check your mortgage terms for overpayment limits and early repayment charges. Many lenders allow 10% overpayments per year without penalties.