Samina Naz is on the brink of becoming mortgage-free at 45, thanks to a tip a colleague gave her a few years ago.
The retail worker, from Manchester, has cut her £87,000 home loan to £19,000, partly by overpaying the balance.
She lives with her husband and two children, aged 23 and 16, in a three-bedroom home they extended around a decade ago, funded through equity release.
The work increased their borrowing from the original 2003 mortgage of £71,000 to £87,000, leaving the family with a higher debt burden for years.
Her exact monthly payments have fluctuated depending on the rate of her mortgage at the time, but she says overpaying – paying more than your required monthly amount, either as a one-off lump sum or regular top-ups – has allowed her to reduce the rate quicker than she would have otherwise.
Most lenders typically allow you to overpay your mortgage by 10 per cent of the outstanding balance each year without penalty. This can reduce the debt you owe and the interest payments, meaning your monthly payments get lower and you clear the debt sooner.
Samina said overpaying wasn’t something she understood until a colleague explained it to her around five years ago.
Since then, she estimates around £20,000 has been shaved off the balance early, with the rest of the reduction down to her usual monthly payments. The £20,000 payments have been made gradually rather than through major lump sums.
“I don’t have a fixed monthly figure because it varies, we just try to put extra in whenever we can,” she says.
Samina makes her overpayments via Sprive, an app founded in 2021 that automatically sets money aside based on your spending to be used for overpayments, and also gives you cashback on certain spending, which you can use to make overpayments.
Samina says the approach has not required dramatic cutbacks, but it has relied on changing how routine spending is handled.
Rising living costs have made the push to clear the debt feel more urgent – rises in mortgage rates and the cost of living are some of the main reasons she is focused on overpaying as much as she can now.
She says the aim of becoming mortgage-free now feels within reach, with her hoping to clear it within the next year.
She explains: “The idea of being free from the mortgage completely gives me peace of mind, especially when I think about supporting my children and just having more financial security as a family.
“I’d rather put the effort in now, while we can, and reduce that pressure for the future.
“I might think differently from people who are happy to earn money, pay bills and wait the standard 25-30 years for their mortgage to finish, but then you are restricted from enjoying life the way you want to. Financial freedom means everything to us.”
Once cleared, she says the shift will be significant, meaning she can help with funding for her children’s weddings and hopefully leave something behind for them as an asset. They are also hoping to travel more.