Disclosure: This post contains an affiliate link to Sprive, which means I may earn a small commission if you sign up, at no extra cost to you. This isn’t personal financial advice. Investing means your capital is at risk, and mortgage terms vary by lender, so always check your own mortgage documents or speak to an adviser about your circumstances.
Overpaying your mortgage by £100 a month can save you £28,000. I know how that sounds. But the numbers are real, and I want to run them properly with you, the same way I did over on Instagram, because once you see it written down, it’s genuinely one of the most persuasive pieces of maths in personal finance.
Here’s the scenario: you have a £250,000 mortgage, a 30-year term, and a 4% interest rate. Pay an extra £100 a month on top of your normal payment, and you’ll save just under £28,000 in interest and shave around four years off your mortgage. Not double it. Not “if everything goes perfectly.” Just £100 a month, sent to your mortgage instead of somewhere else.
The bit people usually miss is that you don’t need to find £100 you don’t currently have. Further down, I’ll show you how I use a free app called Sprive to turn money I’m already spending on my food shop into mortgage overpayments, without changing how I shop. First, let’s look at the maths properly, because it’s worth understanding before you decide if it’s right for you.
What Overpaying by £100 a Month Actually Does to Your Mortgage
Every mortgage payment is split into two parts: interest and capital. Interest is the cost of borrowing. Capital is what you actually owe. Early in a mortgage, most of your payment goes on interest, so the capital barely moves.
When you overpay, that extra money goes straight onto the capital. A smaller capital balance means less interest gets charged the following month, which means more of next month’s payment reduces the capital too. It builds on itself.
I worked out the numbers for a £250,000 repayment mortgage over a 30 year term at 4% interest, using the same method a lender uses to calculate a monthly payment. Here’s what different overpayment amounts do to that mortgage over its lifetime:
| Overpayment | New mortgage term | Time saved | Interest saved |
|---|---|---|---|
| £50 a month | 27 years 10 months | 2 years 2 months | £15,237 |
| £100 a month | 25 years 11 months | 4 years 1 month | £27,957 |
| £150 a month | 24 years 3 months | 5 years 9 months | £38,760 |
| £200 a month | 22 years 10 months | 7 years 2 months | £48,060 |
These are my own calculations, based on a standard repayment mortgage, so you can see exactly where that £28,000 figure comes from. It isn’t a rounded marketing number. It’s what a £100 monthly overpayment genuinely does to a mortgage of that size, kept up for the full term.
Look at the jump between £50 and £100 a month. Doubling the overpayment doesn’t just double the interest saved; it very nearly doubles the time saved too.
That’s the snowball effect at work. The earlier and the more consistently you overpay, the harder each pound works, because it stops interest building up on itself for years to come, not just for this one payment.
Why Such a Small Amount Makes Such a Big Difference
£100 a month doesn’t feel like a lot. Over a year, it’s £1,200, a small fraction of a £250,000 mortgage. But you’re not just saving £1,200 a year. You’re saving years of interest on that £1,200, because it comes off your capital right at the start of the mortgage, exactly when the most interest is building up.
It’s also worth knowing that 4% is a reasonable example rate, but plenty of mortgages sit above that today. According to current UK mortgage rate data, the average rate across all outstanding UK mortgages was close to 4% by mid-2026, but new fixed deals were running noticeably higher, often above 5%, depending on your deposit and lender.
If your own rate is higher than 4%, the same £100 overpayment saves you more in cash terms, not less, because a higher rate means more interest to cut.
I ran the same £250,000 example at 5.5%, and a £100 monthly overpayment saved just under £45,000 over the term. So if your rate isn’t 4%, don’t assume your savings will be smaller. Often, they’re bigger.
Check These Two Things Before You Start
Your overpayment allowance
Most lenders, Nationwide included, let you overpay by up to 10% of your outstanding balance each year without charging you anything extra. Go over that, particularly on a fixed rate deal, and you may face an early repayment charge (ERC).
A £100 monthly overpayment works out at £1,200 a year, which sits comfortably inside the 10% allowance for most mortgages. Still, check your own mortgage offer or annual statement, because allowances and ERC periods vary between lenders.
Your emergency fund and any expensive debt
Overpayments aren’t like money in a savings account. Once it’s gone onto your mortgage, you can’t easily get it back without applying to borrow again.
Which? generally recommends having three to six months of essential costs set aside before you start overpaying, and clearing anything on a credit card or loan first, since those rates are almost always higher than your mortgage rate. If that’s already sorted for you, overpaying is one of the more reliable ways to put spare money to work.
How to actually set up the overpayment
Most lenders let you add a regular overpayment in a few minutes through online or mobile banking, usually by increasing your existing direct debit or setting up a standing order alongside it. If you can’t find the option, a quick call to your lender will sort it. When you set it up, say clearly whether you want the extra amount to shorten your term or lower your monthly payment, since some lenders default to one and won’t ask. It’s a five-minute job that keeps working for years.
You Don’t Need Spare Money to Start Overpaying
This is the part that changed things for me. You don’t have to find a new £100 that isn’t already in your budget. I use an app called Sprive, which gives cashback on everyday shopping such as supermarkets, restaurants, and days out, and sends that cashback straight to your mortgage provider as an overpayment instead of into your bank account.
So instead of finding extra money, you’re redirecting money you were always going to spend anyway. If you get around 2.5% cashback on a £100 weekly food shop, that’s roughly £10 a month towards your mortgage without changing a single habit. It adds up faster than people expect.
Using my link currently gets new users a £5 bonus towards their first overpayment when they buy their first gift card through the app. Sign up to Sprive here.
I’ve gone through exactly how Sprive works, which supermarkets and retailers are included, and how to set it up step by step in my full review of Sprive, if you want to see the whole thing before you download it.
What About Investing Instead?
Mortgage overpayments aren’t the only home for spare money, and I get asked about this constantly.
If your money could earn a higher return when invested than the interest you’re paying on your mortgage, then in pure maths terms, investing can come out ahead over the long run, though your capital is always at risk and returns are never guaranteed.
I’ve run the full comparison, including a half-and-half approach that splits your spare money between the two, in my guide to overpaying your mortgage or investing, because it’s a genuinely personal decision that depends on your own goals, not just the numbers.
If becoming mortgage-free is what actually matters to you, the certainty of overpaying can be worth more than a theoretically higher return sitting somewhere else. There isn’t one right answer here, only the right one for you.
It’s also worth remembering that pension contributions come with their own tax relief, so for some people, topping up a pension before overpaying a low interest mortgage can make more sense than either option on its own. That’s a bigger conversation than this post, but it’s worth having with yourself before you commit your spare money anywhere.
Is Overpaying Your Mortgage by £100 a Month Worth It?
For most people with a repayment mortgage and a little room in their budget, yes. £100 a month is a realistic figure for a lot of households, especially once some or all of it comes from cashback rather than your take-home pay, and the maths genuinely does show a five-figure saving over the life of an average mortgage.
The number that gets me every time isn’t the £28,000. It’s the four years. That’s four years without a mortgage payment, four years where your income is entirely your own. Small, boring, consistent overpayments get you there quietly, without needing a windfall or a pay rise to make it happen.
If your emergency fund is sorted, you’re not carrying expensive debt, and you’ve got room within your lender’s allowance, £100 a month is one of the simplest financial decisions on your list.
FAQs on Overpaying Your Mortgage
How much can I overpay my mortgage without a penalty?
Most lenders let you overpay up to 10% of your outstanding mortgage balance each year without an early repayment charge, though this varies by lender and mortgage type. Check your offer document or latest annual statement to confirm your own allowance.
Does overpaying reduce my monthly payment or shorten my term?
It depends on your lender. Some automatically shorten your term while keeping your monthly payment the same. Others let you choose to lower your monthly payment instead and keep the term as it is. Ask your lender which applies to your mortgage.
Can I get my overpayments back if I need the money later?
Usually not, without applying for further borrowing or remortgaging. Treat overpayments as money you won’t be able to access quickly, and keep a separate emergency fund for anything unexpected.
Is Sprive free to use?
Yes. Sprive is free to download and use. It earns money through partnerships with retailers rather than charging users directly, and any cashback you earn goes towards your mortgage overpayment.
Should I overpay my mortgage or invest the extra money instead?
It depends on your mortgage rate compared with likely investment returns, and how much you value certainty over potential growth. My full comparison walks through the maths on both.
Have you ever worked out what a small overpayment could do to your own mortgage? Even a modest £50 a month makes more difference than most people expect. And if you fancy trying the cashback route, my Sprive link gets you a £5 head start.
