What Is Loan Overpayment?

Loan overpayment means paying more than your required monthly repayment. This reduces the outstanding balance faster, which in turn cuts down the amount of interest you pay over the life of the loan.

Why Use a Loan Overpayment Calculator?

This free tool helps you estimate how much time and interest you could save by overpaying your loan. Whether it’s a personal loan, student loan, or car finance, overpaying can significantly reduce your financial burden.

Example Scenario

If you borrow £130,000 at 4.5% interest over 25 years, your monthly payment would be around £720. But if you overpay by £200 each month, you could save over £30,000 in interest and repay the loan 7 years earlier.

Common Questions

Is there a penalty for loan overpayment? Some lenders may charge early repayment fees. Always check your loan terms.

Does overpaying reduce my monthly bill? Usually, it reduces the loan term. Some lenders may let you reduce your monthly payments instead—ask them.

Can I make a one-off overpayment? Yes. Even one extra payment can reduce the total interest you’ll pay.