What Happens If You Pay More Each Month on Your Mortgage?
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.
Paying even a small amount more each month reduces your balance a little faster than the schedule, which can reduce the total interest and bring the end date forward. How much depends on your balance, rate and term. This page shows the size of the effect in one example, for small amounts and for what happens if you stop after a while.
Small extra amounts
Take a £200,000 mortgage at 4.5% with 25 years remaining. The table shows the estimated effect of paying these extra amounts every month, assuming the rate stays the same, your payment stays the same and there are no charges. Each row has a link to open the figures in the calculator.
| Extra each month | Estimated result | Try it |
|---|---|---|
| £25 | about £6,044 of interest saved, 11 months sooner | Open in calculator |
| £50 | about £11,534 of interest saved, 1 year 10 months sooner | Open in calculator |
| £100 | about £21,142 of interest saved, 3 years 6 months sooner | Open in calculator |
| £250 | about £42,366 of interest saved, 7 years 2 months sooner | Open in calculator |
What if you stop later?
Some people pay extra for a while and then stop. The table shows £100 a month extra paid only for the first 2, 5 or 10 years, then stopped, on the same example.
| Paid for | Estimated result |
|---|---|
| 2 years | about £4,572 of interest saved, 6 months sooner |
| 5 years | about £10,075 of interest saved, 1 year 2 months sooner |
| 10 years | about £16,319 of interest saved, 2 years 1 month sooner |
In this example the money you have already paid in has reduced the balance, so the table still shows some saving after you stop, and from then on only the required payment is made. Some lenders offer ways to borrow back, and some limit stopping and restarting, so check your mortgage terms. Check your lender’s yearly overpayment allowance and any early repayment charge before paying extra. See the UK mortgage overpayment cap and what an early repayment charge is. See also overpaying with a variable income and how much should I overpay?.
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 it worth paying a small amount more each month?
It can reduce the interest and bring the end date forward, but the effect depends on your balance, rate and term. The table shows estimates for four small amounts. Whether it suits you depends on your circumstances.
What if I stop paying extra?
In this example the balance stays lower than it would have been and the required payment carries on. Lenders differ on borrowing back and on stopping and restarting, so check your terms.
Do I need to tell my lender?
It depends on your lender and how you pay. Some let you add an overpayment through online banking or a standing order, and some ask you to set it up with them. Check with your lender.
Related guides
how mortgage overpayments work, whether you pay interest on overpayments, how many extra payments a year, changing your term when you remortgage. See also how to overpay your mortgage, should I overpay my mortgage? and how much should I overpay?