Even small regular overpayments can save tens of thousands in interest. A $200,000 mortgage at 4% over 25 years can save over $20,000 and cut 4+ years off the term with a $200/month overpayment.
Are there limits on mortgage overpayments?
Most lenders allow up to 10% of the outstanding balance per year without an early repayment charge (ERC). Check your mortgage terms before making lump-sum overpayments, as charges can apply on fixed-rate products.
Should I overpay my mortgage or invest instead?
If your mortgage rate is higher than the after-tax return you could earn investing, overpaying is the better choice. Many people split the difference — overpaying to some extent while also building an investment portfolio.