Barclays Mortgage Overpayment

pr1mate

I have accrued an overpayment balance (pot) over a number of years. Can anyone tell me what this balance is actually achieving. Is it actually saving me any money? I worry it's stagnant. 

Barclays guidance. 

Overpayments lower than 3 times your usual monthly payment

These overpayments help you pay off your mortgage sooner but your monthly payment stays the same. They go into an ‘overpayment balance’, which we take into account when working out your interest charges. The overpayments build up to an amount that can help you pay off your mortgage sooner. It can also enable you to make underpayments in future, which we explain in detail below

K_S

@pr1mate Based on what they've said "They go into an ‘overpayment balance’, which we take into account when working out your interest charges." the balance in the overpayment reserve does reduce the capital amount on which the interest is charged.

So it appears you are benefiting from it like you would if the overpayment simply reduced the capital owed, with some additional flexibility (whatever it is that the overpayment reserve allows you to do).

pr1mate said:

I have accrued an overpayment balance (pot) over a number of years. Can anyone tell me what this balance is actually achieving. Is it actually saving me any money? I worry it's stagnant. 

Barclays guidance. 

Overpayments lower than 3 times your usual monthly payment

These overpayments help you pay off your mortgage sooner but your monthly payment stays the same. They go into an ‘overpayment balance’, which we take into account when working out your interest charges. The overpayments build up to an amount that can help you pay off your mortgage sooner. It can also enable you to make underpayments in future, which we explain in detail below

dimbo61

Say you have a £50,000 mortgage outstanding and £5,000 in the overpayment pot.
You are only paying Interest on £45,000
£50,000-£5,000
Now your mortgage payment remains the same every month but before the Normal mortgage term ends you will get a letter from Barclays saying you have £5,000 mortgage balance and £5,000 in the overpayment pot.
Do you wish to clear the mortgage X number of months early.