Paying even €50 extra a month off a typical Irish mortgage could save you over €13,000 in interest. Push that to €1,000 a month and the saving tops €131,000, with your mortgage cleared more than 14 years early.
Most of us set up our mortgage repayment and never think about it again. But every euro you pay above your standard repayment goes straight off the balance you owe. A smaller balance means less interest charged every month after that, for the rest of the term. That’s why small overpayments snowball into big savings.
Here’s what it looks like in real numbers.
The example: €420,000 over 30 years at 3.5%
Take a €420,000 mortgage over 30 years at a 3.5% interest rate. The standard monthly repayment is €1,885.99.
If you never overpay, you will hand back €258,956 in interest over the 30 years. That’s on top of the €420,000 you borrowed, so the house really costs you close to €680,000.
Now let’s see what happens when you add a little extra each month.
Small extras add up
You don’t need a windfall to make a difference. On the same mortgage:
- +€50 a month (new repayment €1,935.99) saves €13,079 in interest and takes 1 year 4 months off your term.
- +€100 a month (€1,985.99) saves €24,837 and cuts 2 years 6 months.
- +€150 a month (€2,035.99) saves €35,473 and cuts 3 years 7 months.
At €1,000 extra a month, you would be mortgage-free in under 16 years instead of 30, and you would pay roughly half the interest.
Savings at a glance
€420,000 mortgage · 30 years · 3.5% · standard repayment €1,885.99 · total interest without overpaying €258,956
| Extra per month |
New monthly repayment |
Interest saved |
Time off your mortgage |
| €50 |
€1,935.99 |
€13,079 |
1 yr 4 mo |
| €100 |
€1,985.99 |
€24,837 |
2 yrs 6 mo |
| €150 |
€2,035.99 |
€35,473 |
3 yrs 7 mo |
| €200 |
€2,085.99 |
€45,143 |
4 yrs 8 mo |
| €250 |
€2,135.99 |
€53,979 |
5 yrs 7 mo |
| €500 |
€2,385.99 |
€88,818 |
9 yrs 4 mo |
| €1,000 |
€2,885.99 |
€131,514 |
14 yrs 2 mo |
Figures assume the rate stays at 3.5% for the full term and overpayments start from month one.
Before you overpay: check with your lender
If you are on a fixed rate, talk to your lender first. Some lenders charge a fee for overpaying during a fixed-rate period, while others allow a set amount each year without penalty. On a variable rate, you can usually overpay freely, but it’s still worth confirming.
A few other things to ask:
- Will the overpayment shorten your term or lower your monthly repayment? Shortening the term is what produces the savings shown above.
- Can you make lump-sum payments as well as monthly ones? A bonus or tax refund can go a long way.
- Is your rainy-day fund in place first? Money paid off your mortgage is hard to get back, so keep a cash buffer for emergencies.
Protect the home you are paying off
Overpaying helps you own your home sooner. Mortgage protection makes sure your family can keep it if the worst happens. If you are reviewing your mortgage anyway, it’s a good moment to check you are not paying more than you need to for cover.
Get your free mortgagfe protection quote from Beat the Bank today.
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*The information provided is for general informational purposes only. Financial Planning Matters Limited T/A “Beat the Bank” is regulated by the Central Bank of Ireland. Financial Planning Matters Limited t/a Beat the Bank is not a bank and is not authorised to carry out banking business in Ireland.
*Illustrative example only, based on a €420,000 mortgage over 30 years at a constant rate of 3.5%. Actual savings will depend on your interest rate, mortgage term and lender. Rates can change and your repayments may increase. If you’re on a fixed rate, your lender may charge a fee for overpaying, so check with them first. This post is for information only and is not financial advice.
