Mortgage Overpayment Calculator
See how extra monthly payments reduce your mortgage term and total interest paid. Enter your loan details and overpayment amount to visualize the savings.
Loan Details
Savings Summary
Interest Saved
Time Saved
| Original | With Overpayment | |
|---|---|---|
| Monthly Payment | — | — |
| Total Interest | — | — |
| Total Cost | — | — |
| Payoff Time | — | — |
How Mortgage Overpayments Work
When you make an overpayment on your mortgage, the extra money goes directly toward reducing your principal balance. This has a compounding effect — a smaller balance means less interest accrues each month, which means more of your regular payment goes toward principal too.
Even modest overpayments can dramatically reduce both the total interest paid and the time to pay off your mortgage. For example, overpaying just $200/month on a $300,000 loan at 6.5% can save over $100,000 in interest and cut years off your term.
Monthly Payment Formula
The standard monthly mortgage payment is calculated using:
M = P × [r(1+r)^n] / [(1+r)^n − 1]
- M = monthly payment
- P = principal (loan amount)
- r = monthly interest rate (annual rate ÷ 12)
- n = total number of payments (years × 12)
Tips for Overpaying Your Mortgage
- Check with your lender for prepayment penalties before making extra payments
- Even small regular overpayments compound into large savings over time
- Consider lump-sum overpayments from bonuses or windfalls
- Make sure extra payments are applied to principal, not future payments
- Balance overpaying your mortgage against higher-interest debts and retirement savings