How to pay off your mortgage faster

For most of us the mortgage is our biggest bill. It's also the one expense that should generate a profit, although you'll normally have to wait a few decades before you see any money. Find out how to pay off your mortgage faster so you can make that day come a little earlier.
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Reasons for over paying

Overpaying on your mortgage by a small amount can save you a lot of money. Let's say you have a mortgage for £100,000 and your interest rate is 6%. In that scenario a monthly over payment of just £100 will save you £26,892.54 over a 25 year repayment period. The time saving is also significant as you'll have the mortgage paid off 6 years and 4 months early.

Be careful

Although overpaying your mortgage makes a lot of sense, there are things you should be aware of. Lenders don't necessarily like early repayments so some have set a minimum overpayment amount. When you pay less than the minimum, your payments don't go against the mortgage and therefore don't decrease the debt. At the end of the financial year these monies are calculated against the mortgage.

Offset mortgages

This type of mortgage offers the most flexibility. You'll be able to pay your loan amount off even quicker thanks to daily recalculations of your mortgage. Many High Street lenders have given their loans this type of flexibility for the same reason, although most set minimum and maximum amounts you can overpay by.


The most important thing about overpaying your mortgage is to be disciplined. There’s no point in over using other credit facilities like overdrafts and credit cards and then overpaying on your mortgage as these types of borrowing end up costing you more. As with any financial decision, don’t over stretch.

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