Mortgage overpayment calculator
Illustrate how extra payments could affect your mortgage under stated assumptions.
Explore what extra mortgage payments change
The overpayment calculator shows how an immediate lump sum or additional monthly payments affect a repayment mortgage under stated assumptions. It starts from your outstanding loan, annual rate and remaining term, then compares the original schedule with the overpayment scenario. The result helps explain the mechanics; it does not decide whether using your money this way is right for you.
Before entering an extra payment, check your mortgage terms. Lenders can apply allowances, charges and different payment-recalculation policies. Enter any expected charge explicitly and ask the lender how the overpayment would be applied. Do not assume an allowance mentioned for another mortgage applies to yours.
How the overpayment model works
The baseline uses the normal monthly repayment for the entered loan, rate and remaining months. Each modelled month, interest is added to the current balance, the scheduled payment is deducted and the process repeats until the balance is cleared or the term ends. The final payment is limited to what remains due.
The scenario first applies the immediate lump sum, capped at the outstanding principal. It then applies the selected monthly treatment and adds your extra monthly payment. Under “keep scheduled payment”, the original scheduled payment remains the reference and the additional payment usually shortens the modelled term.
Under “recalculate scheduled payment”, the tool resets the scheduled amount after each month to work towards the original end date. This is a specific mathematical scenario, not a claim that your lender recalculates in that way. The original and initial revised scheduled payments shown do not include the separate extra monthly amount you entered.
Interest saving after charges equals baseline interest minus scenario interest minus the lender charge you supplied. The tool does not deduct lost savings interest, value liquidity or compare investments. Those would require separate assumptions and personal decisions.
Worked example: £100 extra each month
Take a hypothetical outstanding mortgage of £200,000, a constant 5% annual rate and 300 months remaining. With no lump sum or charge, the original scheduled repayment is about £1,169.18 a month. Choose to keep that scheduled payment and add £100 every month, creating an initial total monthly payment of about £1,269.18.
The model clears the loan in 258 months instead of 300. Baseline interest is approximately £150,754.02 and scenario interest is £126,248.73, producing a saving of about £24,505.30 before any charge. The displayed figures are independently rounded, so subtracting the rounded totals can differ by a penny from the internally calculated saving.
This is an illustration using an assumed unchanging rate, not a guaranteed saving on an actual mortgage. A rate change, different overpayment date or lender policy changes the outcome. If you enter a £500 charge, the displayed saving after charges falls by £500; the model does not finance that charge into the loan.
Put the result in the context of your move
A move can bring costs before sale proceeds arrive, so distinguish money available for an overpayment from money needed for tax, legal work or a temporary housing overlap. Use the moving budget and housing overlap calculator to understand those separate commitments.
MoneyHelper’s guide to paying a mortgage off early discusses charges and factors to consider. The useful “typical cost” here is your lender’s actual charge and allowance, rather than a national average. Obtain those terms before making an instruction to pay.
Try the calculator with no extra payment as a baseline, then change one assumption at a time. That makes it easier to see whether the result comes from the lump sum, monthly amount or payment treatment.
How to use this tool
- Copy the mortgage position. Enter the outstanding balance, current rate and remaining months. Use figures for the same point in time so the comparison starts from a coherent baseline.
- Specify the extra payments. Add an immediate lump sum, monthly extra and any expected charge. Select the payment treatment that you want to model and confirm the actual lender policy separately.
- Review timing and interest. Compare payoff months and interest after charges with the baseline. Recheck the assumptions if the rate or available cash changes before making any payment instruction.
Frequently asked questions
Does the revised payment include my monthly extra?
The displayed scheduled-payment figure is the mortgage schedule amount. Your entered extra monthly payment is applied in addition; use both to understand the monthly cash commitment.
Will my lender apply the same recalculation?
Not necessarily. The recalculation option resets the schedule monthly to the original end date. Ask your lender whether it reduces the payment, term or something else and when it recalculates.
Does the tool assume overpayments are free?
Only when you enter no expected charge. It cannot establish your allowance or verify charges. Read your mortgage terms and include the charge that applies to your own proposed payment.