Mythbusting the Viral TikTok Mortgage Hack: Should I Overpay My Mortgage?

The TikTok Claim in a Nutshell

The viral TikTok says:

“Overpay by one extra payment a year and youll shave years off your mortgage"

Lets break that down and fact check that...

Maybe in the excitement of getting your keys, the numbers blurred into the background. You were focused on paint colours, furniture deliveries, and the joy of finally having a place that’s yours.

But after a few months of payments, something catches your eye:

“Why is so much of my payment going to interest?”

You’re not imagining it. In the early years of a mortgage, the majority of your monthly payment goes straight to the lender in interest, not towards reducing your balance. It’s a shock for many new homeowners and it’s exactly why the idea of overpaying your mortgage has become such a hot topic on TikTok.

One viral claim says:

“Make one extra mortgage payment a year and you’ll shave years off your term.”

But is that actually true? And how does it work in the UK?

Let’s break it down properly.

🔍 Why Your Mortgage Feels Like It’s Not Moving

Every repayment mortgage in the UK follows an amortisation schedule - a fancy way of saying your payments are structured so that:

• Interest is front‑loaded

• Principal repayment is back‑loaded

In the early years, your lender earns most of their interest. In the later years, you finally start eating into the balance.

This is why your mortgage can feel like it’s barely shrinking at first.

But here’s the good news:

Overpayments attack the balance directly and that changes everything.

💥 The Power of One Extra Payment (Explained Simply)

Let’s imagine a homeowner in the UK with a £300,000 mortgage at 5% over 30 years.

Their monthly payment (just principal + interest) is roughly £1,610.

Now imagine three scenarios:

Scenario 1: No Overpayments

You pay the standard amount every month. You finish in 30 years. You pay a huge amount of interest over that time.

Scenario 2: One Extra Payment Per Year (Lump Sum)

You pay an extra £1,610 once a year. This goes directly to your principal. You shorten your mortgage by years, not months. You save tens of thousands in interest.

Scenario 3: Spread That Extra Payment Monthly

Instead of £1,610 once a year, you pay about £135 extra per month. The impact is almost identical - sometimes even better because the balance reduces earlier.

Why Overpayments Work So Well

Because interest is calculated on your remaining balance, every pound you knock off early:

• reduces the interest charged tomorrow

• accelerates how quickly future payments hit the principal

• compounds into huge long‑term savings

It’s like pushing a snowball downhill - the earlier you start, the bigger the effect.

A Real UK Example (Simplified)

Let’s say you overpay £100 a month on a £300,000 mortgage at 5%.

Over 30 years:

• You could save £30,000–£40,000 in interest

• You could shave 3–4 years off your term

Increase that to £200 a month?

• Savings jump dramatically (£60,000-£70,000)

• Term shortens even further - 6-7 Years

This is why the TikTok hack sounds magical because the maths genuinely is powerful.

But…

⚠️ Before You Overpay: The Downsides You MUST Know

TikTok rarely mentions these.

1. Early Repayment Charges (ERCs)

Most UK fixed‑rate mortgages allow 10% overpayment per year. Go over that and you could be charged.

2. Savings Rates Might Be Higher

If your mortgage rate is 2% but your savings account pays 5%, overpaying might not be the smartest move.

3. You Lose Access to the Money

Once it’s in your mortgage, it’s not easily retrievable.

4. Not All Lenders Apply Overpayments Correctly

Some automatically treat extra payments as “future payments” instead of reducing the balance. You must ensure it’s applied to principal.

Are There Limits to What You Can Overpay?

Yes and they vary by lender.

Most UK lenders allow:

• 10% of your outstanding balance per year on fixed rates

• Unlimited overpayments on tracker or SVR mortgages

But every product is different. Every lender is different. Every homeowner’s situation is different.

This is exactly where personalised advice matters.

How to Overpay Your Mortgage (UK Step‑by‑Step)

Most lenders make it easy:

• Increase your direct debit

• Make a manual bank transfer

• Use your lender’s app

• Call your lender to confirm it’s applied to principal

• Or ask your broker (me!) to check your product terms first

A Story From Essex: The Couple Who Thought £1 a Day Was Enough

A couple in Colchester came to me after seeing the viral “£1 a day” hack.

They were excited — and I love that energy.

But when we ran the numbers:

• £1 a day = £365 a year

• It does help

• But it won’t shave off 10 years

• It saves hundreds, not tens of thousands

Once they understood the real mechanics, they chose a strategy that actually moved the needle and they’re now on track to pay off their mortgage six years early.

That’s the power of proper guidance.

So… Should You Overpay Your Mortgage?

Here’s the truth:

Overpaying is worth it when:

• Your mortgage rate is higher than your savings rate

• You want to reduce your term

• You want to improve your LTV before remortgaging

• You have spare cash after building an emergency fund

• Your lender allows fee‑free overpayments

Overpaying may NOT be right when:

• You’d trigger early repayment charges

• Savings rates are higher

• You need liquidity

• You’re planning to move or remortgage soon

There is no one‑size‑fits‑all answer but there is a right answer for you.

Want to Know Whether You Should Overpay? Let’s Chat.

A 10‑minute conversation could save you thousands or stop you from making a costly mistake.

👉 Book a free, friendly chat with me online I’ll check your mortgage terms, your overpayment allowance, and your goals and help you decide what’s genuinely best for you.