Homeowners could save thousands by using cash boost from National Insurance cuts to overpay mortgages

  • Santander UK shows how homeowners could save thousands by putting the National Insurance (NI) cut towards overpaying their mortgage
  • A worker on a salary of £30,000, who put the full NI saving of £29 towards their mortgage would save £7,405 in interest and shave over a year off their mortgage term
  • Santander customers overpaid more than £903 million on their mortgages online or by mobile in 2023, up 78% from £508 million in 2022 

With many workers benefitting from a pay-packet boost this month as a result of the NI cuts, data from Santander shows how putting some, or all of this extra cash towards mortgage overpayments could save homeowners thousands over the life of their mortgage.

Calculations from the lender show that a worker earning £30,000 a year will see an extra £29 a month in their January 2024 payslip. If they repurposed all £29 towards overpaying a 25-year mortgage of £200,000 at 4.7% they would save £7,4051 in interest and be mortgage free more than a year earlier than planned. 

Even committing just part of a NI saving could make a difference, with Santander accepting overpayments from as little as £10 per month, which on the same mortgage would save more than £2,500 in interest and shave four months off a customer’s mortgage term2

Graham Sellar, Head of Business Development, Mortgages at Santander, said: “Many people will shortly see the first benefits of the National Insurance cut in their pay-packet. For those able to, using this extra money each month to overpay on their mortgage could reap huge benefits in the long run, saving thousands and helping them achieve the mortgage-free dream sooner than expected.”

Those earning between £60,000 and £100,000 a year will see an NI saving of £63 a month, which if put towards a £200,000 mortgage would save £15,0933 in interest and take over two years off the term. 

Regular monthly overpayments4    Interest saved over life of mortgage Time taken off mortgage term
£10 £2,6524 months
£12 £3,1695 months
£29  £7,4051 year 1 month
£45£11,145 1 year 8 months
£62£14,8812 years 3 months
£63£15,093 2 years 4 months

Calculated on the basis of a £200,000, 25-year mortgage at 4.7%.

Santander makes it easy for mortgage customers to make overpayments through its online and mobile portal. In 2023, Santander customers overpaid a total of £903 million through the lender’s online and mobile channels, an increase of 78% on the previous year. 

In the first week of 2024 alone, 18,198 overpayments were made online, with customers making use of the reset 10% overpayment allowance which sees most mortgage lenders allow customers to repay 10% of their outstanding capital each year before any early repayment charges are incurred. 

To see how much you could save, go to Santander’s mortgage overpayment calculator: Overpayment calculator | Santander UK.

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Notes to Editors:
1.    Based on regular overpayments of £29 a month on a £200,000, 25-year mortgage at 4.7%. This is for illustration only and doesn’t take into account fluctuating interest rates. Customers should speak to their lender about any fees or charges that may be incurred as a result of overpaying their mortgage. 
2.    Based on regular overpayments of £10 a month on a £200,000, 25-year mortgage at 4.7%. This is for illustration only and doesn’t take into account fluctuating interest rates.
3.    Based on regular overpayments of £63 a month on a £200,000, 25-year mortgage at 4.7%. This is for illustration only and doesn’t take into account fluctuating interest rates.
4.    Overpayments based on NI savings calculated for the following salaries:

SalaryNI saving from Jan 2024


The information contained in our press releases is intended solely for journalists and should not be used by consumers to make financial decisions.

Santander UK is a financial services provider in the UK that offers a wide range of personal and commercial financial products and services. At 30 June 2023, the bank had around 19,400 employees and serves around 14 million active customers, 7 million digital customers via a nationwide 445 branch network, telephone, mobile and online banking. Santander UK is subject to the full supervision of the FCA and the PRA in the UK. Santander UK plc customers’ eligible deposits are protected by the FSCS in the UK.

Banco Santander (SAN SM, STD US, BNC LN) is a leading commercial bank, founded in 1857 and headquartered in Spain. It has a meaningful presence in 10 core markets in the Europe, North America and South America regions, and is one of the largest banks in the world by market capitalization. Santander aims to be the best open financial services platform providing services to individuals, SMEs, corporates, financial institutions and governments. The bank’s purpose is to help people and businesses prosper in a simple, personal and fair way. Santander is building a more responsible bank and has made a number of commitments to support this objective, including raising €220 billion in green financing between 2019 and 2030. At the end of the third quarter of 2023, Banco Santander had €1.3 trillion in total funds, 166 million customers, 8,700 branches and 212,000 employees.