Overpaying Your Mortgage by £1,000 a Month: What Could It Do?
This guide is for general information only and does not provide financial advice. Check your lender’s terms before overpaying, as early repayment charges may apply. Your home may be repossessed if you do not keep up repayments on your mortgage.
Overpaying by £1,000 a month can make a large difference to the interest you pay and when your mortgage ends, and it can also be more than a lender’s yearly allowance. This page shows estimates for five balances, then how £12,000 a year compares with a 10% allowance.
That is £12,000 a year. Whether it fits your budget, and whether it stays within your lender’s yearly allowance (often a percentage of the balance, but lender-specific), are for you to check. See the UK mortgage overpayment cap.
What it could do, by balance
The table shows estimates for five balances at 4.5% with 25 years remaining. It assumes your lender keeps your payment the same, so the mortgage ends sooner, and that no fees or early repayment charges apply.
| Balance | Estimated result | Try it |
|---|---|---|
| £100,000 | about £52,113 of interest saved, 18 years 10 months sooner | Open in calculator |
| £150,000 | about £70,637 of interest saved, 16 years 10 months sooner | Open in calculator |
| £200,000 | about £85,962 of interest saved, 15 years 2 months sooner | Open in calculator |
| £250,000 | about £98,866 of interest saved, 13 years 10 months sooner | Open in calculator |
| £300,000 | about £109,894 of interest saved, 12 years 9 months sooner | Open in calculator |
How £12,000 a year compares with a 10% allowance
Many lenders let you overpay up to a yearly allowance, often a percentage of the balance, without a charge. Allowances vary, so this table uses 10% only as an example. A 3% charge on the amount over the allowance is also only an example: charges vary by lender and deal.
| Balance | Example 10% allowance | Amount over it | Example charge |
|---|---|---|---|
| £100,000 | £10,000 | £2,000 | £60 |
| £150,000 | £15,000 | none | none |
| £200,000 | £20,000 | none | none |
| £250,000 | £25,000 | none | none |
| £300,000 | £30,000 | none | none |
On the smaller balances, £12,000 a year is above an example 10% allowance, so an early repayment charge could apply if your lender works this way. You can estimate a charge with your own figures in our early repayment charge calculator, and our guides explain what an early repayment charge is and whether it is worth paying one. Check your own mortgage offer before you pay a large regular amount.
To see how the interest rate changes figures like these, read how your rate changes what overpaying does.
Figures are estimates from this site’s calculator. They assume a repayment mortgage, a rate that stays the same for the whole term and no fees or early repayment charges, and they are illustrations, not forecasts. Try your own figures in the free mortgage overpayment calculator.
If you are unsure whether overpaying suits you, consider speaking to a regulated mortgage adviser.
Questions people ask
Can I overpay £1,000 a month?
It depends on your lender’s yearly allowance and your deal. £1,000 a month is £12,000 a year, which would be above an example 10% allowance on a balance below £120,000. Above the allowance, an early repayment charge may apply during a fixed or discounted rate, so check your mortgage offer first.
Would £1,000 a month clear my mortgage much sooner?
It can shorten the term a lot, as the table shows for five balances. The effect depends on your balance, rate and term, and it assumes no charges and a rate that stays the same.
Is it better to pay £1,000 a month or a lump sum?
Other things being equal, money that reaches your mortgage sooner reduces more interest, but a large lump sum is easier to push over your yearly allowance. See lump sum versus monthly overpayments.
Other worked examples
overpaying £200 a month, overpaying £300 a month, overpaying £500 a month, how your rate changes what overpaying does, how much to overpay to clear your mortgage sooner. For how much to overpay in general, see how much should I overpay?