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Overpayments - Annually vs Monthly

If I am on fixed rate and can overpay by 10%, are there any advantages/savings by making the overpayments annually (Jan) rather than monthly?



  • StuC75StuC75 Forumite
    2.1K Posts
    Its better to pay little and often.maybe not by much.. but still better to pay off monthly..
  • hildosaverhildosaver Forumite
    346 Posts
    Tenth Anniversary 100 Posts Name Dropper Combo Breaker
    Think it depends on when your bank calculates it's interest, if they do it daily then monthly overpayments are best, if yearly.. well you get the idea.
    I am insane and have 4 mortgages - total mortgage debt £200k. Target to zero = 10 years! (2030)
  • originalmiscellanyoriginalmiscellany Forumite
    1.7K Posts
    Part of the Furniture 1,000 Posts Combo Breaker Mortgage-free Glee!
    My parents warned me of the "good old days" where you they updated your mortgage amount once a year, so if you wanted to you could put in 10K overpayment the day after the mortgage amounts were altered and you then didn't see it reflected in what you paid for another 364 days if you were a bit silly! Of course they did it the other way round and dropped off money at the bank the day before the mortgage was recalculated. Either way, the more modern responsive solutions seem to be so much better.

    I think (depending on your bank) overpaying monthly will make a very small difference in how much pay but little steps end up helping you go a long way.
    Feb 2012 - onwards MF achieved
    September 2016 - Back into clearing a mortgage - Was due to be paid off in 32 years in March 2047 -
    April 2018 down to 28.00 months vs 30.04 months at normal payment.
    Predicted mortgage clearing 03/2047 - now looking at 02/2045

    Aims: 1) To pay off mortgage within 20 years - 2037
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