7 mortgage tips that could save you money

A new year is often a good moment to take stock of your mortgage. Even small changes to the way you manage your deal—such as avoiding a move onto a higher rate, or choosing a more cost-effective option—can make a noticeable difference over the lifetime of your loan.

Below are seven mortgage tips designed for home buyers who want to understand where savings may be possible.

1) Check when your current deal ends

If you’re on a fixed rate or a discounted deal, the most important date to know is when it finishes. After your deal ends, many borrowers move to their lender’s Standard Variable Rate (SVR) or another lender rate that may be higher.

A higher rate can increase your monthly payments and the total interest you pay. It’s worth checking your mortgage statement or online account so you know exactly when your current terms end—and how much time you have to plan your next step.

2) Review the interest rate you’re paying

Mortgage interest is a main driver of long-term cost. Even a relatively small change in the interest rate can add up over many years.

When reviewing your mortgage, consider:

• what rate you’re currently paying
• what the repayments would look like on alternative options
• whether switching would trigger any early repayment charges (if you’re still within a fixed deal)

Example (illustrative): On a £200,000 repayment mortgage over 20 years, moving from 3.5% to 2.5% could reduce the total interest paid by tens of thousands over the term. The exact figures depend on your mortgage type, remaining term and current balance.

3) Check whether your insurance is costing more than it needs to

Many homeowners pay for buildings and contents insurance separately from their mortgage, but some lenders and insurers offer multi-product discounts.

It’s not always automatic that bundling is cheaper, so it can help to:

• compare like-for-like quotes (same cover level, excess, and term)
• check whether any discount is conditional on keeping the mortgage with the same provider
• review your insurance annually, especially after renovations or changes in property value

4) Make overpayments if your mortgage allows it

If you have spare cash and your mortgage terms permit it, overpayments can reduce the amount of interest you pay and help you clear your mortgage sooner.

Key points to consider before overpaying:

• whether your mortgage has an overpayment limit (often expressed as a percentage of the outstanding balance)
• whether overpayments are treated as capital reduction (this is common) and how they affect your term or repayments
• whether there are any restrictions during the fixed period

Example (illustrative): A £150,000 mortgage over 25 years at 2.5% with a regular £200 monthly overpayment could shorten the mortgage term by several years and reduce the total interest paid. The outcome depends on the mortgage’s rules and how overpayments are applied.

Overpayments can also provide flexibility if your agreement allows you to pause or vary payments.

5) Reduce the mortgage term (if the repayments are affordable)

Another way to reduce total interest is to shorten the term of your mortgage. This typically increases monthly repayments, but it can reduce the overall cost.

Before choosing a shorter term, it helps to consider:

• whether the higher repayments fit comfortably into your budget
• whether you’re likely to need flexibility in the future
• how any changes might affect your ability to manage other financial priorities

Unlike overpayments, reducing the term is usually a structural change, so it’s important to be confident you can sustain the new repayment level.

6) Get your home valued and review your loan-to-value (LTV)

If your property value has increased since you took out your mortgage, you may have more equity than you think. That can matter because many mortgage pricing structures are influenced by loan-to-value (LTV) bands.

A lower LTV may open the door to more competitive rates, depending on the lender and the product available.

Things to consider:

• whether you’ve made improvements or renovations that could increase value
• how lenders assess property value (and whether they require a formal valuation)
• how any remortgage costs could affect the overall savings

7) Compare fees carefully—“no fees” isn’t always the cheapest option

When taking a new mortgage deal, you may be offered choices such as paying fees upfront or selecting a product with fees included (or a “no fee” option).

A deal with no fees can be convenient, but it may come with a higher interest rate. To judge which option is better, it’s useful to compare the total cost over the period you expect to keep the mortgage, not just the initial fee.

Practical approach:

• calculate the difference in interest between the options
• add any upfront fees to the comparison
• consider how long you plan to stay on the deal

Bringing it together

Mortgage savings often come from a combination of actions: planning around deal end dates, checking your rate, using overpayments where appropriate, and making sure you’re not paying more than necessary for insurance or fees.

If you’re unsure which options are most relevant to your situation, reviewing your mortgage terms (including any early repayment charges) and understanding how changes could affect your repayments and total cost can help you make more informed decisions.

General information only. This page is not financial advice.