Overpay the Mortgage by £200 a Month

Common questions

How much do I save by overpaying my mortgage by £200 a month?

On a £200,000 balance at 4.5% with 25 years left: roughly £35,000 in interest and about 6 years off the term. The exact figure scales with your rate and balance — the calculator above runs your own numbers with full amortization, not a rule of thumb.

What is the 10% overpayment rule on mortgages?

Most UK fixed-rate deals let you overpay up to 10% of the outstanding balance per year without an early-repayment charge. Beyond the cap, ERCs of 1–5% can apply to the excess. Tracker and variable deals often have no cap — your offer document is the authority.

Is it better to overpay the mortgage or save the money?

Compare rates after tax: overpaying a 4.5% mortgage earns a guaranteed, tax-free 4.5%. A savings account must beat that after your tax rate to win. Keep a 3–6 month emergency fund in cash before overpaying anything — mortgage overpayments can't be withdrawn.

Should I reduce the term or the monthly payment when overpaying?

Reducing the term saves far more interest — you kill the loan years early. Reducing the payment lowers monthly outgoings but keeps the term, saving much less. Lenders often default to payment reduction; you usually must ask for term reduction explicitly.