Mortgage overpayments: Are they worth it?

by Aaron Strutt

May 01 2026

Mortgage overpayments: Are they worth it?

New research from Santander UK shows that UK homeowners are increasingly making mortgage overpayments to reduce long-term borrowing costs and improve financial security. Santander reported that customers overpaid more than £894 million on their mortgages in the first four months of 2026 alone — an increase compared to the same period in 2025.

Why are homeowners making overpayments?

Mortgage overpayments can significantly reduce both:

• The total interest paid over the life of the mortgage, and the length of the mortgage term.

Santander’s example illustrates the impact on a £250,000 repayment mortgage over 25 years at an average 4% interest rate:

• Overpaying by £10 per month could save around £2,117 in interest and cut the mortgage term by approximately 3 months
• Overpaying by £50 per month could save around £9,975 and reduce the term by around 1 year and 6 months
• Overpaying by £100 per month could save around £18,619 and shorten the mortgage by nearly 3 years

Is making overpayments a good idea?

For many homeowners, yes — particularly when they have spare monthly income, savings rates are lower than their mortgage rate, and they want to reduce future interest costs. Also, when they are preparing for higher mortgage payments, a fixed rate ends.

Regular overpayments reduce the outstanding mortgage balance faster, meaning less interest accrues over time. Even relatively small additional payments can make a meaningful long-term difference.

What should homeowners consider first?

Overpayments are not always the best option for everyone. Before making them, homeowners should consider:

• Whether they have sufficient emergency savings,
• Any higher-interest debts that should be cleared first,
• Pension contributions and other long-term financial goals,
• And whether their lender applies early repayment charges (ERCs).

Santander allows most fixed-rate customers to overpay up to 10% of their outstanding balance each calendar year without paying an early repayment charge. Some lenders have mortgages without early repayment charges, allowing unlimited overpayments, while others allow up to 20% of the mortgage balance to be overpaid each year.

Mortgage overpayments can be an effective way to save thousands of pounds in interest and become mortgage-free sooner. However, the right strategy depends on individual circumstances, mortgage terms, and wider financial priorities.

Many banks and building societies have apps that allow their customers to make either regular or one-off overpayments, and they show how much interest will be saved per overpayment. Click here to download the Santander overpayments app. 

Speaking with a mortgage adviser can help homeowners decide whether overpaying is the most efficient use of their money, especially in a changing interest-rate environment, particularly if you have an interest-only mortgage. 

Speak to a Trinity Financial adviser today

The mortgage market moves fast — and the right advice can make a significant difference to the rate and deal you secure. Get in touch with our team to discuss your options.

Call Trinity Financial on 020 7016 0790 to secure a fixed or tracker rate mortgage, book a consultation, or use our appointment calendar

The information contained within was correct at the time of publication but is subject to change. It is for general information purposes and is not advice.

Any links to third-party websites are provided for information and convenience purposes only. We are not responsible for the content or availability of external sites.

Your mortgage is secured on your property. Your property may be repossessed if you do not keep up repayments on your mortgage

Source: Santander research