This calculator uses UK conventions (£, monthly compounding). The maths is the same anywhere, but examples and terminology assume a UK repayment mortgage.
UK Mortgage Overpayment Calculator
Work out exactly how much interest you save, and how many years you shave off, by paying a bit extra each month or dropping a one-off lump sum onto your mortgage. Type in your current balance, rate, and remaining term, then add the overpayment plan you are thinking about. The numbers update side by side.
Explain like I'm 5 (what even is this calculator?)
Every month your mortgage payment splits into two slices: interest, which goes to the bank, and principal, which actually shrinks the debt. Overpaying means handing the bank more than it asked for, and every extra pound goes straight at the principal. Less debt means less interest forever after. This calculator runs your mortgage forward two ways, with and without the overpayments, and tells you how much sooner you would be done and how much interest you would not pay.
Calculate
Enter your numbers, then press Calculate.
The headline numbers
- Contractual monthly payment—
- Total interest, no overpayment—
- Total interest, with overpayment—
- Interest saved—
- Time shaved off—
Balance trajectory (end of year)
| Year | Balance, no overpayment | Balance, with overpayment |
|---|
Prove it
Press Calculate to see the formula, the contractual monthly payment, and a 12-month worked example for both scenarios.
The contractual monthly payment uses the standard repayment formula M = B · r · (1 + r)n ÷ ((1 + r)n − 1), where B is the balance, r is the monthly rate (annual rate ÷ 12 ÷ 100), and n is the remaining term in months. Each month interest = balance · r, principal = M − interest, new balance = balance − principal − overpayment. The simulation stops the first month the balance reaches zero. UK lenders apply overpayments as a term reduction, not a payment reduction, so the contractual M stays put.
What the tool cannot know: your lender's overpayment cap and any early repayment charge that applies if you exceed it, rate changes during a tracker or after the fix ends, payment-holiday rules, the tax position on whatever you would otherwise have done with the cash, and your own changes of mind.
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Why overpaying does so much heavy lifting
The thing nobody tells you about a long mortgage is how lopsided the early years are. On a £200,000 loan at 5% over 25 years, the contractual monthly payment is around £1,169. In month one, roughly £833 of that is interest and only £336 chips away at the actual debt. Year on year the split slowly shifts, but for the first decade you are paying the bank far more in rent on its money than you are paying off the loan itself. That is why even modest overpayments early on are so powerful: every extra pound goes straight at principal, and you avoid every future month of interest on that pound.
What the calculator actually does
It runs the loan forward, month by month, in two parallel universes. In the first, you only ever pay the contractual monthly amount. In the second, you also pay your regular overpayment every month plus any one-off lump sum in month one. Each month it works out the interest on the current balance, takes the contractual payment, splits it into interest and principal, then subtracts both the principal and the overpayment from the balance. When the balance hits zero, the loan is done. The difference in finish dates is the time shaved off, and the difference in total interest paid is the cash saved.
When overpaying is the right move, and when it isn't
Overpaying makes financial sense when the after-tax return on whatever else you would do with the money is lower than your mortgage rate. If your mortgage is at 5% and the best after-tax savings rate you can find is 4%, overpaying wins. If you have a cash ISA paying more than your rate, save into that instead. Pension contributions, especially with employer matching or higher-rate tax relief, often beat both. The maths is rarely close once tax is in the picture.
Overpaying is the wrong move if you do not yet have a sensible emergency fund, because money paid off the mortgage is hard to get back without remortgaging, which takes weeks and costs fees. Three to six months of essential outgoings sitting in an easy-access account come first. It is also the wrong move if you have any unsecured debt at a higher rate (credit cards, store finance, some personal loans), because those rates are almost always above mortgage rates. Clear those first.
The 10% rule that catches people out
Almost every UK fixed-rate deal lets you overpay up to 10% of the outstanding balance each year without triggering an early repayment charge. Step over the line and the lender takes a percentage of the overage as a penalty, which can wipe out the interest saving. The 10% is calculated on the balance at the start of the policy year (often the anniversary of completion), and unused allowance does not roll over. If you are planning a big lump sum from a bonus or an inheritance, ring the lender first and ask exactly how the cap works for your deal.
Common mistakes
People underestimate how much a small monthly overpayment matters. £100 a month on a £200,000 loan at 5% over 25 years saves the better part of £20,000 in interest and gets you done years earlier, because compounding works in both directions. People also assume their lender will recalculate the monthly payment after they overpay. By default, most lenders shorten the term instead, so the standing order stays the same and the loan just finishes earlier. If you specifically want a smaller monthly figure (sometimes called a payment holiday or a recast), you have to ask.
Edge cases
If you are on an interest-only mortgage, this calculator does not apply: the contractual payment never touches principal, and overpayments behave differently. If you are inside a low fixed rate that will revert to a much higher SVR in a year or two, the cleanest plan is often to overpay up to the 10% cap during the cheap years, then remortgage when the fix ends. And if you are tempted to clear the mortgage in one big swing during the fix, check the early repayment charge first: a 3% ERC on the outstanding balance can dwarf a few years of interest savings.
Related calculators
The mortgage is one slice of the picture.
Frequently asked questions
Will my lender let me overpay?
Most UK lenders let you overpay up to 10% of the outstanding balance each year while you are on a fixed rate, without any early repayment charge. Once the fix ends and you are on the SVR or a tracker, overpayments are usually unlimited. Check your offer letter or your online account first, because the 10% cap is the rule that catches people out on a big lump sum.
Should I overpay or save into an ISA instead?
Compare the after-tax savings rate against your mortgage rate. If your mortgage is at 5% and the best after-tax rate is 4%, overpaying wins. If a cash ISA pays more than your rate, save instead. Either way, keep an emergency fund (three to six months of essential outgoings) before you tip spare cash into the mortgage, because money paid off the mortgage is awkward to get back.
Does overpaying lower my monthly payment or just clear the mortgage earlier?
By default, UK lenders apply overpayments as a reduction in the term: the contractual monthly payment stays the same and the loan finishes earlier. Some lenders will recalculate the monthly figure on request (sometimes called recasting), which keeps the original end date but lowers the monthly cost. This calculator models the term-reduction approach, which is the default.
Does this calculator send my numbers anywhere?
No. Everything runs in your browser. The numbers you type never leave your device.