The term overpaying your mortgage refers to the voluntary additional payment of cash into your mortgage account over and above the agreed monthly sum.
There are a variety of reasons you might want to do this.
If you have no outstanding debt elsewhere (which is likely to be more expensive) and surplus net income or cash sitting in a savings account earning you little or no interest, then reducing your mortgage is a prudent option. Saving 3.85% in mortgage interest when you are only earning 2% gross interest in your best ISA might seem like a ‘no brainer’.
Alternatively, you might want to use a windfall or bonus to reduce the mortgage sum in case interest rates rise in the future, making payments hard to meet. Or perhaps you are planning a few months sabbatical and you want to take a ‘mortgage holiday’ thus making no payments whilst you aren’t earning.
We all have different priorities and financial circumstances and it’s impossible to consider whether or not you should consider making over payments without knowing more about your personal circumstances. For example, it might be prudent to keep some cash readily available for that rainy day, especially if you are self employed or currently find in a precarious state of employment!
The starting point should be to make sure that your mortgage agreement allows you to do what you are considering. Not all lenders will allow repayment holidays or over payments and some of those that do might charge significant fees for this activity, even if you only slightly exceed what may be allowed.
For more information or to speak to a mortgage adviser, contact us on 01628 507477.
Download our Free First Time Buyers Guide
Recent posts
Research from Lloyds identifies the most affordable areas in the UK for first-time buyers to be able to get onto the property ladder.
On Wednesday, 13th May, King Charles delivered his speech at the House of Lords, outlining the government’s plans for the upcoming year.
Here is a summary of the housing and energy/environment points.
From 18th May 2026, Halifax (part of Lloyds Banking Group) is launching a ‘£5k Deposit mortgage’ to help first-time buyers get onto the property ladder sooner.
Homeowners could be faced with paying over £3,000 more per year on their mortgage if the conflict in the Middle East continues, following new analysis from INTEREST from Moneyfacts.
Best UK Mortgage Rates this Week
14 days ago
Here are the lowest fixed mortgage rates of the week, available to first-time buyers, home movers, buy-to-let, and those remortgaging.
Call us for more information: 01628 507477 or email: team@mortgagerequired.com.
Renters' Rights Act
22 days ago
The Renter’s Rights Bill became law at the end of October, which means it has been signed off by the King, and it is now the Renters’ Rights Act. Despite this becoming law, these changes are likely to start changing within the next six months, with the aim of being fully implemented throughout 2026 and into 2027.
Green Mortgages | Rewards and Benefits
22 days ago
Mortgage lenders are starting to recognise their “Green” responsibilities when it comes to the different products they offer.
Costliest Streets in Great Britain
26 days ago
Recent data from Rightmove shows the most expensive streets in Great Britain, with the majority being situated in the capital.
More information
Trusted by
