How have you/do you become disciplined to overpay your mortgage?

IAMIAM

My term is currently 30 years, age 40, want to pay if off by 55. Balance 187k.
I like the flexibility of having a long term, but I just seem to only pay off small amount less than 100 every couple of months.

Do I bite the bullet and just reduce the term, or do i set up an extra DD with HSBC.

What do you lot do?

amnblog

Set up the extra DD.

grumpy_codger

I'd set up a SO - it gives more flexibility than a DD.
However, I think the interest rate is much lower than 7% and it makes more sense to set the SO to HSBC* Regurla Saver and make lump sum overpayments once a year when the regular saver matures.

*Wow! Do they really pay just pathetuc 5%? If so, there are First Direct and Coop that pay 7%.

poseidon1

IAMIAM said:

My term is currently 30 years, age 40, want to pay if off by 55. Balance 187k.
I like the flexibility of having a long term, but I just seem to only pay off small amount less than 100 every couple of months.

Do I bite the bullet and just reduce the term, or do i set up an extra DD with HSBC.

What do you lot do?

In the past I had an offset mortgage, whereby I sacrificed interest on some savings in exchange for interest eliminated on part of a repayment mortgage.

This worked well since I was a 40% tax payer so the returns on savings were noticeably lower than for a 20% tax payer. Knocked 5.5 years off the mortgage term.

You could do worse than have a play with Barclays offset calculator ( link below) to see how that could work for you, assuming you have taxable savings- 

https://www.barclays.co.uk/mortgages/offset-mortgage/

RelievedSheff

We are with the Halifax and just amended our direct debit to include the overpayment we wanted. In our case £432 a month.

We don't miss the money. The mortgage payment comes out on the first of the month. So once its paid its gone.

We have a year left on this fixed rate and then the plan is that our next 5 year fix will be our last.

tacpot12

Anytime I got a payrise, I made sure I paid at least half of it to my mortgage. 

Brie

would HSBC (or any bank) allow you to have 2 DDs paying on your mortgage??  

and what will HSBC do with the extra payments?  not all banks will take extra payments and reduce the term.  Some will assume you want to reduce future payments.  So make sure you've agreed with them how they are handling them.  Which is why making an annual payment might be easier to manage.  If you went for this but wanted the discipline maybe you could pay the extra £400 or so into a regular savings account by standing order so you don't have to think about it.  

Someone was saying that to help focus their mind on overpaying they divided the mortgage by the number of rooms in the house and then they could focus on "owning" the lounge and then the bedroom or whatever.

here_for_the_tips

Start a diary and join the Mortgage Free Wannabe Challenge 2025. Has kept me focussed, accountable, on track and motivated the last 4 months. I've overpaid more this year then I have in the previous 8 combined and there's 7.5 months to go.

WittyUserName

We’re disciplined about overpaying because we're highly motivated.

We’re highly motivated because we:

- absolutely hate the corporate grind, and that really focuses the mind

- can smell redundancies / nudges to retire in the air (we’re of a certain age) and don’t want to take our incomes for granted. At our ages we know we can’t waltz into similar paying jobs

- see overpaying as 'buying our freedom', something we visualise and vocalise very often: we talk about life without a mortgage in visual terms, painting a picture of living without daily commutes, mindless meetings, unrealistic deadlines, increasing workloads, and nonstop pressure you can never switch off from, even on weekends or holidays. Without a mortgage we can choose to work elsewhere, 2 days a week if we please

- love where we live in London and don’t want to sell up and move to a cheaper part of the country just to escape the grind

We stay disciplined and on track by:

- having defined goals: our detailed spreadsheet captures when we will hit X amount by Y date, so we know that if we drop the ball in one month, it will have a knock-on effect on the rest of the plan and delay our ‘liberation day’ 😁

- celebrating milestones: every time we shave £50k off we celebrate with a nice meal out, spa massages, etc

- throwing every bonus at the mortgage: we’ve assigned our bonuses the job of liberating our future selves

- practicing delayed gratification: sacrificing our disposable income now means instead of a 20y slog we can be mortgage free within the next 4y. It really helps that neither of us has a YOLO mindset and we are home bodies

- making it sustainable: we see it as a game / challenge (we’re quite competitive) but we build in small treats here and there so we don’t feel deprived

Our overpayment plus the non-interest part of our contractual payment add up to £5k hitting the mortgage principal every month. Then there’s our annual bonuses.

The only thing slowing us down is the blasted annual 10% overpayment allowance, which we plan to escape from at the next fix, by applying to a lender that allows unlimited overpayments.

We’ll keep the term as long as possible as a safety net and just keep overpaying until the point where it makes sense to roll over to the SVR and let it peter out.

Like you we’re with HSBC but don’t do DD - every overpayment is done manually each month via the app. Automating it would take away the thrill! (It doesn't take much to keep us happy)

strawb_shortcake

I'm 42, I currently have exactly 11 years left on my mortgage, I have a target date of being mortgage free during my 50th year. 

We took out the mortgage 9 years ago with a 32 year term, thanks to a critical illness payout and a drop in interest rates in yr2 we have made overpayments and reduced the term at renewal. 

We've just started paying an additional £50 a month, I think this will knock off two months a year? At this point

Being mortgage free means I could go to The Seychelles, or Hawaii every year and easily so, this keeps me motivated 

RedFraggle

I upped my direct debit by an extra amount. Can always change it back if I need to.