Early Repayment Calculator

Calculate Early Repayment

Enter your mortgage details to see the costs and potential savings of making an early repayment.

Current Mortgage Balance (£)

Current Interest Rate (%)

Remaining Term (years)

Early Repayment Amount (£)

Early Repayment Charge (%)

ERC Cap (£) (optional)

Early Repayment

Early repayment can save significant interest over your mortgage term, but may incur charges during fixed-rate periods.

Consider your emergency fund and other financial priorities before making large repayments.

Important Considerations

Before making early repayments:

Check your mortgage terms for ERCs
Maintain emergency savings (3-6 months expenses)
Consider higher-rate debt first
Think about investment alternatives
Use annual overpayment allowances

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How Early Repayment Works

Immediate Impact: Reduces your outstanding mortgage balance instantly
Interest Savings: Less interest charged over the remaining term
Monthly Payments: Can reduce monthly payments or shorten term
Equity Building: Increases your property equity faster
Financial Freedom: Reduces overall debt burden
Peace of Mind: Provides greater financial security

When to Consider Early Repayment

Good Times to Repay Early

After your fixed-rate period ends (no ERCs)
When you have substantial emergency savings
If mortgage rate exceeds investment returns
When approaching retirement

Consider Alternatives When

ERCs are high relative to savings
You have higher-rate debt elsewhere
Investment opportunities exceed mortgage rate
Emergency fund would be depleted

Frequently Asked Questions

Essential information about early mortgage repayment

What is an Early Repayment Charge (ERC)?

An Early Repayment Charge is a fee charged by lenders when you pay off part or all of your mortgage during a fixed-rate or discount period. ERCs typically range from 1-5% of the amount being repaid and may have caps.

When can I make early repayments without charges?

Most mortgages allow overpayments of up to 10% of the outstanding balance annually without ERCs. After your initial rate period ends, you can usually make unlimited overpayments without charges.

Should I make early repayments or invest?

This depends on your mortgage rate vs potential investment returns. If your mortgage rate is higher than expected investment returns, early repayment may be better. Consider also your risk tolerance and need for emergency funds.

How much can I overpay without charges?

Most lenders allow overpayments of 10% of the outstanding balance per year without ERCs. Some lenders offer higher allowances or unlimited overpayments. Check your mortgage terms for specific details.

What are the benefits of early repayment?

Early repayment reduces total interest paid, shortens your mortgage term, and can reduce monthly payments. It also builds equity faster and reduces overall debt burden, providing financial security.