Overpaying Your Mortgage by £200 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 £200 a month can reduce the interest you pay and bring your mortgage-free date forward, but by how much depends on your balance, rate and term. This page shows estimates for five balances, then compares what happens if your lender shortens the term with what happens if it lowers your payment instead.
That is £2,400 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 £28,333 of interest saved, 9 years 8 months sooner | Open in calculator |
| £150,000 | about £33,166 of interest saved, 7 years 6 months sooner | Open in calculator |
| £200,000 | about £36,281 of interest saved, 6 years 1 month sooner | Open in calculator |
| £250,000 | about £38,458 of interest saved, 5 years 1 month sooner | Open in calculator |
| £300,000 | about £40,065 of interest saved, 4 years 5 months sooner | Open in calculator |
Shorten the term or lower the payment?
Lenders apply overpayments differently. For a £200,000 balance at 4.5% with 25 years left and £200 a month overpaid, the estimates are:
- If the term shortens: your payment stays at £1,111.66, and the estimate is about £36,281 of interest saved and the mortgage ending about 6 years 1 month sooner.
- If your payment is lowered: your payment could fall to about £1,098.16 after a year and keep falling, with about £19,000 of interest saved.
In this example, shortening the term saves about £17,282 more interest, while lowering the payment frees up a little cash each month. Figures are rounded to the nearest pound, so they may not add up exactly. Which suits you depends on your lender, your budget and your plans. Our guide to shortening your term or lowering your payment explains the two options, and does overpaying reduce your monthly payments or term? covers how lenders apply overpayments.
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
Is £200 a month worth overpaying?
It can reduce the interest you pay and shorten your mortgage, but the effect depends on your balance, rate and term. The table shows estimates for five balances. Whether it is worth it for you also depends on your other priorities, such as an emergency fund. See should I overpay my mortgage?
Will overpaying £200 a month lower my monthly payment?
It depends on your lender. Some keep your payment the same and shorten the term, some lower the payment instead, and some only do so if you ask. Check your mortgage offer or ask your lender.
Can I overpay £200 a month without a charge?
It depends on your lender’s yearly allowance and your deal. £200 a month is £2,400 a year, which would be within an example 10% allowance on a balance of £24,000 or more, but allowances vary by lender, so check your mortgage offer.
Other worked examples
overpaying £300 a month, overpaying £500 a month, overpaying £1,000 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?