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Paying your mortgage off early could save you thousands of pounds in interest – as well as giving you the peace of mind of owning your home outright. Here's how you could become mortgage-free sooner.
Government figures show that households with a mortgage in England paid an average of £242 a week in mortgage payments in 2024-25 – equivalent to around £12,600 a year.
Clearing your mortgage and becoming mortgage-free could therefore free up a significant amount of money each month. Plus, paying your mortgage off early can potentially save you thousands of pounds in interest.
That means even relatively small steps to reduce your mortgage more quickly can make a big difference. Here are three ways you could become mortgage-free.
When your current mortgage deal ends, you’ll usually be switched onto your lender’s standard variable rate (SVR), unless you remortgage onto another deal. Standard variable rates can be very expensive.
However, shopping around for a new mortgage deal before your current deal ends could help you find a more suitable deal.
You can start the remortgage process up to 6 months before your current mortgage deal ends. Bear in mind that if you remortgage before your current deal ends, you may need to pay an early repayment charge.
Another potential benefit of remortgaging is that if you have a repayment mortgage, your loan-to-value (LTV) – the proportion of your property’s value that you have borrowed – may also have fallen since you took out your mortgage. This could be because you’ve paid off some of your mortgage, your home has increased in value, or both.
A lower LTV can give you access to a wider choice of mortgage deals and potentially lower interest rates.
The best mortgage depends on your personal circumstances. The award-winning expert advisers at Mortgage Advice Bureau will find the right mortgage for you.
Get fee-free remortgage advice from the award-winning expert advisers at Mortgage Advice Bureau.
Your home may be repossessed if you do not keep up repayments on your mortgage. Please note some branches of Mortgage Advice Bureau may charge a fee for mortgage advice if you go direct. The fee is up to 1% but a typical fee is 0.3% of the amount borrowed. So make sure you use this site, this form or phone number for fee-free advice.
One way to pay off your mortgage early is to make overpayments.
There are two ways you can overpay:
Making overpayments can reduce the amount of interest you pay overall and means you could clear your mortgage sooner too.
But before you make any overpayments, check your paperwork. Many mortgage deals have a limit on how much you can overpay by during the period of your deal. If you exceed this, you may need to pay an early repayment charge.
Also, make sure you can afford any overpayments. Read our guide Should I pay off my mortgage? which explores the pros and cons of using your savings to pay your mortgage off in full.
If you don’t want to lock your savings away in your house, an alternative option could be to get an offset mortgage. With these mortgages, you put your savings into an account linked to your mortgage. The lender then deducts the amount you have in savings from your mortgage balance before calculating the interest you owe. You won’t usually receive interest on the savings themselves.
Because you’re paying interest on a smaller amount, an offset mortgage can help you pay off your mortgage sooner if your monthly repayments stay the same. More of each payment effectively goes towards reducing what you owe, rather than paying interest.
For example, if you had a £200,000 offset mortgage and £50,000 in a linked savings account, you would generally only be charged mortgage interest on £150,000. If your monthly repayments stayed the same, the interest saving could help you reduce your mortgage balance faster and shorten the mortgage term.
Exactly how much sooner you could repay your mortgage will depend on the lender, your mortgage rate and how much you keep in the linked savings account.
Offset mortgage rates can also be higher than standard mortgage rates, so you’ll need to compare the overall cost rather than looking at the interest saving alone.
HomeOwners Alliance Ltd is registered in England, company number 07861605. Information provided on HomeOwners Alliance is not intended as a recommendation or financial advice.
HomeOwners Alliance Ltd is an Introducer Appointed Representative of Mortgage Advice Bureau (Derby) Limited which is authorised and regulated by the Financial Conduct Authority.
If you take out a mortgage or protection product through Mortgage Advice Bureau, they pay us a referral fee of 25%. You are not obliged to use their services.
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