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Home & mortgage

Mortgage Overpayment Calculator

See how much interest and time monthly or lump-sum overpayments save, used to shorten the term or to lower the payment, after any early repayment charge.

Reviewed by CentExactCalculated in your browser. Shared links include inputs.

Interest you save

$44,431.41

mortgage-free 5 yrs 2 mos sooner, on $47,400.00 overpaid

Your mortgage
$
%
0%12%
yrs
What you overpay
$
$
Use the overpayment to
Overpayment charge
%

From your offer: the early repayment charge on overpayments above the free allowance. 0 if none.

How the saving was worked out

The mortgage was run twice from the same $250,000.00 at 5%: once at $1,461.48 a month with nothing extra, which costs $188,441.28 in interest, and once with your overpayments, which costs $144,009.87.

Keeping the payment the same means every overpayment comes straight off the balance and the last payment arrives sooner.

  • Mortgage-free

    19 yrs 10 mos

    5 yrs 2 mos sooner

  • Total overpaid

    $47,400

    extra and one-off together

  • Payment a year in

    $1,461.48

    unchanged

  • Other way round

    $21,358

    saved by lowering the payment

Fixed rate for the years left. An estimate, not financial advice, providers may calculate differently.

Balance by year
  • No overpayment
  • Shorter term

Shorter term or lower payment

The same overpayments used both ways
OverpaymentPaid off inSaved
Shorter term19 yrs 10 mos$44,431
Lower payment25 yrs$21,358

Shortening the term always saves more interest; lowering the payment frees cash every month. Ask your lender which it applies, as many choose for you unless you say.

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How this is calculated

Your mortgage is run twice from the same balance, rate and years left: once as it stands, and once with your monthly and one-off overpayments taken off the balance in the month they are paid. Kept at the same payment, the overpaid loan ends sooner; with the payment recalculated over the months left after each overpayment, it ends on time at a lower payment, and the calculator works out both. The saving is the difference in total interest, less any charge your lender takes on overpayments beyond the free allowance.

Interest savedinterest without overpaying − interest with it − charges

Lower payment after an overpaymentB × r ÷ (1 − (1 + r)−n)

B
the balance after an overpayment
r
the monthly rate, from the Interest rate and its quotation
n
the months still left on the original term
The derivation under the result shows both runs with your figures; the table compares the two ways of using the same overpayments.

What this does not include

  • Rate changes: the rate you enter holds for every year that is left.
  • What the money could earn elsewhere, such as savings interest or a pension's tax relief.
  • Tax relief on mortgage interest where your country gives it, which lowers the real saving.
  • Your lender's own rules on minimum overpayments and when a recast happens.

Overpaying a mortgage: a shorter term or a lower payment. Why the same overpayment saves twice as much when it shortens the term, how a recast works, what allowances and charges do, and the legal caps by country.

CentExactCalculator publisher

CentExact publishes the calculation method, worked examples and available data sources. Automated checks cover reference calculations; they do not certify a result for your circumstances or imply approval by a lender or tax authority.

How we build and test our calculators

This calculator is for general information only and is not financial advice. Results are estimates based on the figures you enter and the stated formula; lenders and providers may round or calculate differently. Check any decision with the institution involved or a qualified adviser.