How I Paid My Mortgage Off Early (in 2 years)

Having a mortgage isn’t fun. Ever since I started earning money my main financial goal was to buy my own home. I did everything I could to boost the deposit that I could afford to put down on my first home; from working overtime, finding lots of different side hustles, and monetising my blog.

In September 2019 I bought my first home. Once I moved in my biggest money goal shifted from buying a home to paying off my mortgage. Here are the steps I took to pay my mortgage off within 2 years.

How I Paid My Mortgage Off Early

How I Paid My Mortgage Off Early

My Mortgage

My one bedroom flat in Sheffield cost £80,000 in 2019 and I took out a £44,000 mortgage to pay for it. At the time of buying my first home I was contracted to work part-time (earning a £12,500 salary) and therefore my repayments were low (£200 a month). My original mortgage deal was a 2 year fixed-rate of 2.16% (25 year term) and I was allowed to overpay by 10% of the remaining balance each year without incurring any fees.

When starting my homeownership journey I used a mortgage calculator to get an interest and payment breakdown. Using mortgagecalculator.uk I can see the yearly interest paid on my balance – not fun! However, this is a great motivation to pay it off as quickly as possible!

Mortgage numbers:

Cost of property: £80,000
Location: Sheffield
Deposit: £36,000
Mortgage: £44,000
Rate & Term: 2 year fixed-rate of 2.16% (25 year term)

I originally wanted to buy a 2 bedroom flat with a mortgage for £120,000, but I had to compromise as at the time I only had a part-time job to go towards making my mortgage payments.

On top of my mortgage there are some additional costs that come with my leasehold flat, including ground rent (£300), service charges (£800) and building insurance (£250) which are all paid annually. Otherwise the living costs associated with my flat are relatively low.

Fee free mortgage advice

One of the best decisions I made on my journey to becoming mortgage-free was seeking fee-free mortgage advice. Unlike advisers who charge upfront or hidden fees, fee-free advisers offer their services at no cost to you—meaning you get expert, unbiased guidance without adding to your financial burden. This helped me find the most cost-effective mortgage deals, structure my repayments wisely, and avoid costly mistakes. That support made a real difference in helping me pay off my mortgage early, and it’s something I’d highly recommend to anyone aiming for the same goal.

The benefits of paying off your mortgage

My main motivation for paying off my mortgage stems from watching my parents struggle with debt after being mis-old a mortgage product. As well as this, paying off your mortgage can bring several financial and emotional benefits. Let’s take a look at some of them:

One less monthly bill: Eliminating one of the largest regular bills can significantly lower your monthly expenses, making your budget more flexible. This can allow you to use your money to start investing or saving for another financial goal.
Your home will be fully paid for: Another benefit of paying off your mortgage is that you will own your home outright. This can give you a sense of security and peace of mind knowing that you don’t have to worry about making payments on your home anymore. Additionally, if you ever need to sell your home, you won’t have to worry about paying off the remaining balance on your mortgage.
You can save money on interest: Interest is one of the most significant expenses associated with a mortgage. By paying off your mortgage, you will no longer have to pay interest on your loan. This can save you a significant amount of money over the life of your loan.

Paying off your mortgage can be a great way to improve your financial situation. If you are tired of making monthly payments, want to own your home outright, or want to save money on interest, then paying off your mortgage may be the right choice for you. It’s always best to talk to a mortgage broker to review your options.

Talk to a Mortgage Broker Melbourne to see if this is the right move for you, and start working towards a debt-free future today!

View this post on Instagram

A post shared by Emma (Bee Money Savvy) (@beemoneysavvy)

Mortgage overpayments

I absolutely understand the privileged position I found myself in to be able to make overpayments on my mortgage. Part of the reason that I was in this position is because my mortgage offer was based solely on my £12,500 employment income. All the overtime, side hustle and blog income I regularly earn wasn’t taken into consideration when I was offered my mortgage agreement. Therefore, my monthly payments were significantly less than I could afford.

Because I’d already built up a comfortable emergency fund I used any extra income to overpay on my mortgage. I overpaid by £4,400 in 2019 and £3,800 in 2020 (using my 10% overpayment allowance). After this, I worked out that by the end of my 2 fixed-term I would have around £33k left to pay off my mortgage balance in full – so I made that my savings goal.

Sprive App

The Sprive app helps you to make regular overpayments and pay your mortgage off early. Using it’s smart calculator, it can be instructed to save small manageable amounts that can later be used to make overpayments on your mortgage.

You’ll get a free £5 when you sign up with referral code BEEMONEY and buy your first gift card. Earn more money towards your mortgage overpayments through cashback, surveys and gift card purchases.

Download Sprive

Earning extra income

To make overpayments I focused my attention on earning extra income. I tried anything to increase my savings, but the majority of my additional earnings came from blog income, employment overtime and various side hustles.

Blog income

I started blogging in 2017. At the time, I had no idea you could make money as a blogger but after 6 months I started to receive offers of paid work. My blog earns money in 3 ways:

sponsored blog work (this is where brands pay me to write about them on my blog)
affiliate income (commission-based advertising)
advertising networks (displaying adverts)

Soon after buying my home, my blogging income grew. In my first year of homeownership I earned £11,000 from blogging and £20,000 in my second year. I used the majority of this income towards mortgage overpayments.

Overtime

Due to the seasonal nature of my previous job (events) I was offered overtime during busy periods. I earned an extra £2,000 a year by working overtime in my previous job. This money was used to fund mortgage overpayments and the final lump-sum payment.

Side hustles

During my time as a student I discovered lots of side hustles. I earn an extra £250 per month thanks to various side hustles, including:

online surveys (£50 p/m)
selling unwanted things
mystery shopping
market research interviews (£50-£100 per call)
referral offers (£200 p/m)

I used the money I earned from side hustles towards the deposit on my home but when I became a homeowner I used this towards my mortgage overpayments.

Saving more money

I figured that another way to increase my savings would be to spend less money. In pursuit of becoming mortgage-free I used lots of websites and apps to save money. I regularly review my outgoings to see where I can reduce my costs further, here are some of my favourite money-saving tools:

Cashback

When you shop with a cashback website, app or card they earn commission for sending you to the retailers, they then pay this commission back to you as cahsback. I earn over £1000 a year in cashback using the following tools:

TopCashback – website
Quidco – website
Airtime Rewards – automatic cashback app
Cheddar – automatic cashback app
JamDoughnut – cashback on gift cards
Amex – 5% cashback card
Chase – 1% cashback card

There are tons of cashback apps and websites – sometimes you can use multiple cashback options in conjunction with each other – doubling your savings!

Discount codes

I previously had a student card (TOTUM) and used to claim student discount where possible. I recently started a new job in the NHS, so I’ve been enjoying the NHS discounts available to me now. It’s worth seeing if your employer offers a discount scheme. If you don’t have access to a work-based discount scheme, I recommend Honey. Honey is a browser extension that automatically searches for discount codes when you reach the checkout of an online shop.

Free food

I claim £100’s worth of free meals, drinks and snacks every month which helps me to keep the cost of my food shop down. These are my favourite apps for claiming free food:

Shopmium, GreenJinn, and CheckoutSmart are all Cashback apps. They require you to buy a specific product, then claim the money back by uploading a picture of the receipt. In some cases I’ve been able to claim discounts and cashback with these purchases – leading to a small profit.

Remortgaging

My fixed-term mortgage rate was for 2 years. At the end of my mortgage contract I went onto my lender’s standard variable rate (SVR), at this point I was able to make an uncapped overpayment. Using the additional income I earned throughout my mortgage term I paid off the balance in full when I came to the end of my fixed-term.

If this wasn’t the case and I’d have been unable to pay off my mortgage balance in full my plan was to look for a new mortgage deal. Here’s what I would have looked for if I’d have needed to remortgage:

Reducing the interest rate
Increasing repayments
Reducing the remaining term

A good mortgage broker can weigh up your options when it’s time to remortgage – almost all mortgage brokers are paid commission by the lender which means it costs you nothing to get their expert help.

Mortgage-free, what now?

I managed to save enough to pay the remaining balance at the end of my fixed-term deal (in November 2021). I paid my mortgage off at 27. I don’t have big plans now that I’m mortgage free but I do plan on making some sensible decisions with my money.

I plan on putting what used to be my monthly mortgage payments into savings and investments to secure my future financial independence. Follow my journey @beemoneysavvy on Instagram or Twitter.