Guide to lowering your mortgage payments
- Over the year to March 2026, household costs inflation reached 3.6%
Household inflation for mortgaged homeowners has risen 37.6% over 5-years
If you own a home with a mortgage, you've probably felt the squeeze more than most lately. Figures from the Office for National Statistics (ONS) confirm it: mortgage holders have been hit harder by inflation than renters.
Over the year to March 2026, household costs inflation reached 3.6%. This is a reflection of how quickly everyday prices, for things like food, housing, energy, and transport, are climbing.
To put that into relative terms, for every £100 you spent five years ago now costs you £137.60, and that's for exactly the same lifestyle you had before.
It's a meaningful gap, and if you're feeling the pressure, you're not alone. With prices climbing across the board, it can feel like everything costs more than it used to. That's exactly why it's worth taking a closer look at what's likely your biggest monthly expense: your mortgage.
The good news? You have more options than you might think. Below, Cleerly have gathered our top tips for lowering your mortgage payments right now, along with smart steps you can take to reduce them further down the line.
1. Check you're not on a Standard Variable Rate (SVR) mortgage
One of the costliest mistakes borrowers make is slipping onto their lender's Standard Variable Rate (SVR) once their introductory deal ends, whether that was a Tracker or a Fixed Rate.
When you're on an SVR, your lender decides the rate you pay above the Base Rate, and those rates are almost always higher than other deals. That can leave you paying far more than you need to, often without even realising it.
The good news is that there's a clear way forward. If you're currently on your lender's SVR, switching to a new deal is one of the most effective ways to bring your monthly payments down.
Start by confirming the rate you're on right now. Then consult an independent broker like Cleerly to understand the most suitable mortgage deals available to you. Keep in mind that rates can shift quickly, and the deals you can access will depend on your personal circumstances.
2. Consider whether a Tracker or Fixed Rate may be more suitable
Tracker mortgages are back in the spotlight, and the numbers tell the story. In April 2026, the number of borrowers applying for Tracker products was more than three times higher than the month before (The Guardian, May 2026). Two things are driving this surge: lower starting rates and the freedom they offer. Let's walk through what that could mean for you.
The immediate savings
The clearest benefit of a Tracker mortgage right now is the cost. As of 16 June 2026, the cheapest two-year Tracker deals sit at around 3.96% (MoneyFacts, 22 June 2026). Compare that with the cheapest two-year Fixed Rates, which hover around 4.55%, and the gap becomes hard to ignore.
To put it in real terms: on a £250,000 repayment mortgage over a 20-year term, choosing a Tracker over a fixed deal could save you roughly £78 a month (MoneyFacts, 22 June 2026).
The flexibility to adapt
Savings aren't the only draw. Many Trackers come with genuine flexibility, and that can be just as valuable.
Lenders such as Nationwide and Halifax often offer Tracker deals with no Early Repayment Charges. (Check your mortgage documentation before overpaying. Fixed-rate deals usually penalise you with Early Repayment Charges if you overpay by more than 10% annually). This means you can treat a Tracker as a temporary home for your mortgage. If fixed rates fall in the coming months, you'd be free to switch onto a Fixed deal without facing thousands of pounds in exit fees. It's a way to keep your options open while the market settles.
The risks worth weighing
We believe in giving you the full picture, and Trackers do carry risk. Because your rate moves in line with the Bank of England Base Rate, your payments can rise as well as fall.
The Bank of England has set out a worst-case scenario in which the Base Rate could climb to 5.25% by early 2027 to keep inflation in check. If that happened, anyone on a Tracker would feel the full effect. Your monthly payments could increase sharply, so it's wise to have a financial cushion in place to absorb the extra cost.
Is a Tracker right for you?
A Tracker mortgage can offer real savings and welcome flexibility, but it suits some situations better than others. The right choice depends on your finances, your appetite for a little uncertainty, and how comfortable you'd feel if rates moved upward.
If you're weighing up your options, speaking to a mortgage adviser can help. We'll look at your circumstances and explain your choices in plain terms, so you can decide with confidence.
3. Extend your mortgage term
Extending your mortgage term simply means adding extra years to the time you originally planned to repay your loan.
Say you took out a 25-year mortgage. You could ask to extend it to 35 years, adding another decade to the term. Spreading your repayments over a longer period brings your monthly costs down, which can make a real difference to your budget. The trade-off? You'll usually pay more in interest over the life of the loan.
There's also a helpful safety net. Under the government's Mortgage Charter, you can ask to return to your original term within six months of requesting an extension, without an affordability check. It's designed to give you a little financial breathing space when you need it most.
The advantages
Extending your term can work in your favour when:
- Your monthly repayments are too high. A longer term lowers what you pay each month, freeing up cash flow.
- You have an interest-only mortgage. It gives you more time to pay off the full amount of the loan.
- New major costs have come along. Whether it's childcare, a career change, or another big expense, lower repayments can ease the pressure.
- You're coming to the end of a fixed-term deal. If higher interest rates would make your current repayments unaffordable, extending can help keep things manageable.
The things to weigh up
It's worth keeping the full picture in mind, because a longer term isn't right for everyone:
- You'll pay more interest overall. Stretching repayments over more years means the total cost of your mortgage goes up.
- It takes longer to become mortgage-free. Your debt stays with you for more years than originally planned.
- Your age may be a factor. Lenders are often cautious about extending terms into later life, so this can be harder to arrange if you're over 40.
Can you extend your term without taking out a new loan?
Yes, in many cases you can. If you'd rather extend your mortgage than remortgage with a new provider, the first step is to speak directly with your current lender. This is especially important if you're finding monthly payments a stretch.
Most lenders are happy to consider an extension. They may carry out an affordability assessment first, though if your repayments are going down, this often isn't needed.
Your age will also come into the conversation. As a rule, most lenders won't extend a term beyond your 75th birthday, although some now offer longer plans of up to 40 years.
And thanks to the Mortgage Charter, you have flexibility built in. If you can afford to return to your original term within six months, you're free to do so. Choose to switch back after the six-month window, and you'll simply need to go through an affordability check.
Think carefully before extending your mortgage term
Extending your term can be a smart way to ease the pressure, but it's a decision worth thinking through carefully. The best choice depends on your finances, your plans for the future, and how the extra interest fits into the bigger picture.
If you'd like to talk it over, Cleerly's mortgage advisers are here to help. We'll explain your options in plain terms and guide you towards the choice that suits your circumstances, so you can move forward with confidence.
4. Secure a rate up to 6-months in advance
If your current mortgage deal is coming to an end soon, it pays to plan ahead. Speaking with a mortgage broker now gives you time to explore your options and secure a suitable new deal before your existing one runs out.
Here's why timing matters. Locking in a rate today protects you if rates climb before your new deal starts. And if rates happen to fall in the meantime, you'll often have the freedom to reapply for a better offer. Either way, you're covered, which brings real peace of mind.
Mortgage offers usually stay valid for three to six months with many lenders, as long as your circumstances don't change. Better still, you're under no obligation until you formally accept, so locking in early simply keeps your options open.
Even if remortgaging isn't urgent for you right now, it can still be worth reviewing where you stand. Early repayment charges may apply, but in some situations the savings from a new deal can outweigh those costs. That might be the case if rates suddenly rise and push your monthly payments up, or if you need to release extra funds for home improvements.
A quick conversation with a broker like Cleerly can help you weigh it all up, so you can make the choice that's right for you, with confidence.
5. Request a Product Transfer
If your monthly payments feel like a stretch, a product transfer could be a simple way to ease the pressure. It works much like a remortgage, with one key difference: instead of moving to a new lender, you stay put with your current one and switch to a different deal.
That difference matters more than you might think, and it can work nicely in your favour.
Why the affordability checks tend to be simpler
When you move from one product to another with the same lender, the checks involved are usually lighter than those you'd face when remortgaging elsewhere.
Why does that help? Because a new lender starts from scratch, assessing your finances in full. Your existing lender already knows you, so the process tends to be quicker and more straightforward.
How it can help if your circumstances have changed
Life rarely stays the same, and your income or situation may look different now compared to when you first took out your mortgage. Perhaps you've changed jobs, gone self-employed, or seen your earnings shift.
In cases like these, a product transfer can be a real help. The lighter affordability checks mean you're often more likely to:
- Get past the hurdles that can trip up a full remortgage
- Secure a new, more manageable deal with less hassle
- Reduce your monthly outgoings without the longer application process
The downside worth weighing up
We always like to give you the full picture, and a product transfer isn't without its trade-off.
By staying with your current lender, you could miss out on a better or cheaper deal available elsewhere. Loyalty doesn't always mean the lowest rate, so it's worth checking whether the wider market has something more suited to you before you decide.
Not sure which option suits you?
A product transfer can be a sensible way to lower your payments, but the right choice always comes down to your own circumstances.
That's where we come in. Cleerly's mortgage advisers will compare staying with your current lender against switching to a new one, then explain your options in plain terms. With the full picture in front of you, you can move forward with confidence.
6. Consider over-paying on your monthly mortgage payments
If you have some spare cash, overpaying your mortgage is well worth a closer look. Done right, it can save you tens of thousands in interest and help you clear your mortgage years sooner.
That said, it isn't always the best home for your money. With some savings accounts paying decent rates, you might actually come out ahead by saving instead. The trick is knowing which option works harder for you.
Why overpaying can pay off
When you overpay, you reduce the debt you took on to buy your home. That brings two clear benefits:
- You could be mortgage-free sooner. Every extra pound reduces the years left on your loan.
- You pay no interest on the amount you overpay. And the interest you save often beats the returns you'd get from a savings account, though not always.
The key rule: Compare your rates with a broker
Before you overpay, work out whether your money is better off reducing your mortgage or sitting in savings.
If your mortgage rate is roughly the same as, or higher than, your savings rate, overpaying usually makes sense.
The reverse isn't automatically true, though. A higher savings rate can beat overpaying, but not in every case. It depends on a few things:
- Whether you make a one-off overpayment or regular ones over time
- The size of your remaining mortgage debt
- How many years you have left to repay
- Whether you pay tax on your savings interest
That last point matters more than people often realise. Tax can eat into your savings returns, which sometimes tips the balance back in favour of overpaying.
How much can you overpay penalty-free?
The amount you can overpay without a charge depends on your deal:
- Fixed Rate or discount deals: most lenders let you overpay by up to 10% of your outstanding balance each year without penalty.
- Standard Variable Rate (SVR) or some trackers: you can usually overpay as much as you like, though it's worth checking if you're on a tracker. SVRs are often expensive, so it may also be worth seeing whether remortgaging could save you money on top.
Go over your lender's limit and you'll typically face a fee, usually between 1% and 5% of the amount you've overpaid. A quick check of your terms before you start will help you stay on the right side of any limits.
The hidden bonus: a lower loan-to-value
Overpaying does more than shrink your interest bill. It also brings down your loan-to-value (LTV), the percentage of your property's value that you've borrowed./p>
7. Improve your Loan to Value (LTV)
Your loan-to-value ratio, or LTV for short, tells you what percentage of your home's value you've borrowed. It sounds technical, but the idea behind it is simple once you see it in action.
Here's an example. Say you buy a house worth £100,000 and put down a £20,000 deposit. That deposit covers 20% of the price, which means you borrow the remaining 80%. So your LTV is 80%. The bigger your deposit, the lower your LTV, and the lower your LTV, the better your position tends to be.
Why your LTV affects your interest rate
As a rule, a higher LTV usually means a higher interest rate. Why? Because lenders see a larger loan, relative to the property's value, as a slightly bigger risk. To balance that risk, they tend to charge more.
Flip it around, though, and the picture brightens. The more of your home you own outright, the less risk you represent to a lender, and the more attractive the rates they're willing to offer you.
How a lower LTV can cut your future payments
This is where it really pays to keep an eye on the numbers, especially when you're remortgaging.
Lenders often set their best deals around certain thresholds, such as 80% or 85% LTV. If you're close to one of these markers, nudging just below it can make a genuine difference. Reaching a lower band could unlock cheaper rates, which in turn could bring your monthly payments down.
So if you've paid off a chunk of your mortgage, or your home has risen in value, it's worth checking where your LTV sits before you remortgage. You might be closer to a better deal than you think.
Want to know which band you're in?
Working out your LTV and spotting the right moment to remortgage isn't always straightforward. If you'd like some guidance, Cleerly's mortgage advisers are happy to help. We'll explain where you stand in plain terms and guide you towards the deals that could save you money, so you can move forward with confidence.
8. An Offset Mortgage may be right for you
An Offset mortgage lets you use your savings to reduce the amount of your mortgage you pay interest on. Instead of earning interest on your savings, you link them to your mortgage and let them work in your favour.
Here's how it works in practice. Say you have a £250,000 mortgage and a savings account with the same lender holding £25,000. Rather than paying interest on the full £250,000, you'd only pay interest on £225,000. Your savings effectively cancel out part of your mortgage balance.
Like other deals, offset mortgages come with fixed, variable, or tracker rates. You can also choose between a capital repayment or interest-only basis, so there's room to suit how you prefer to manage your money.
What benefits can you expect?
An Offset mortgage offers a good deal of flexibility, and the advantages can add up:
- Tax-efficient use of your savings. Because you're not earning interest on your cash, you won't pay tax on savings income or dip into your personal savings allowance. Your money still works hard for you, though, by bringing down your mortgage interest. This can be especially worthwhile for higher and additional rate taxpayers.
- Real savings on interest. By offsetting a lump sum and topping up the account regularly, you could save a meaningful amount in interest charges over the life of your mortgage.
- The choice of how you benefit. Keep your monthly repayments the same and your balance will fall faster, helping you become mortgage-free sooner. Or opt for smaller monthly payments instead, with the amount depending on how much your savings reduce the interest you owe.
- Easy access to your money. Your savings stay yours. Withdraw cash whenever you need it (your interest payments will simply rise) or add to your savings to reduce your interest further. The flexibility is always in your hands.
- A helping hand for family. Many lenders let you link your savings to your child's mortgage. By placing your money in their linked account, you help them pay less interest, making this a smart way for the Bank of Mum and Dad to support the next step onto the property ladder.
Is an Offset mortgage right for you?
Offset mortgages aren't the perfect fit for everyone. The right choice depends on your circumstances, the size of your savings, and how you'd like to pay off your mortgage. To help you weigh it up, here's a balanced look at both sides.
Advantages
- You'll pay no tax on the interest you save.
- You could save more on interest than you'd earn in a standard savings account.
- You can still pay into and withdraw from your savings whenever you like.
- Lower interest charges could help you clear your mortgage sooner or reduce your monthly payments.
Disadvantages
- Interest rates can be higher than on comparable standard repayment mortgages.
- You usually won't earn interest on the cash held in your linked account.
- You might prefer to put your savings towards a larger deposit instead.
- There's a fairly limited range of offset mortgages to choose from.
Not sure if an Offset Mortgage is the right move?
An Offset Mortgage can be a clever way to make your savings work harder, but it's a decision worth thinking through carefully. The best option always comes down to your own situation and what you want your money to achieve.
If you'd like to talk it through, our mortgage advisers are here to help. We'll explain your options in plain terms and guide you towards the choice that suits you, so you can move forward with confidence.
9. Switch to an Interest-Only Mortgage
If your income isn't steady but you're confident a lump sum is on its way, an interest-only mortgage could be worth a closer look. Perhaps you're expecting an inheritance, or a series of sizeable bonuses, that would let you clear your mortgage in a few large payments down the line.
As the name suggests, an interest-only mortgage means you pay only the interest on your loan each month. You're not chipping away at the amount you borrowed, just covering the interest, which keeps your monthly payments lower than they would be on a standard repayment deal.
What you'll need to qualify
Interest-only mortgages aren't as widely available as they once were, and lenders set the bar fairly high. To access one, you'll usually need to meet certain criteria, including:
- A strong income, as the requirements tend to be steep
- A good chunk of equity in your home
- A clear repayment plan showing how you'll pay off the loan when the term ends
There's one more thing worth knowing. If you're finding your current mortgage difficult to keep up with, your lender may offer interest-only as a way to ease the pressure for a while.
The risk you can't ignore
It's important to be clear-eyed about this option. Switching to interest-only doesn't make the debt disappear. You'll still need to repay the full amount you borrowed at the end of the term.
Without a solid plan to do that, you could find yourself in a tough spot, potentially even having to sell your home to settle what you owe. That's why a reliable repayment strategy isn't just helpful here, it's essential.
Thinking it through?
An interest-only mortgage can offer real breathing space month to month, but it comes with serious responsibilities and risks that deserve careful thought.
If you'd like to talk it over, Cleerly's mortgage advisers are here to help. We'll look at your circumstances, explain your options in plain terms, and help you decide whether it's the right move, so you can go ahead with confidence.
10. Improve your Credit Score
When you apply for a mortgage, your lender will take a look at your credit reports as part of the process. These reports show how you've managed money and borrowing in the past, and they help the lender build a picture of you as a borrower.
How your credit score shapes your options
Your credit score plays a bigger role than many people realise. It can influence three important things:
- Whether your application is accepted. A stronger score reassures lenders that you're a reliable borrower.
- How much you can borrow. Your score helps shape the size of the loan a lender is willing to offer.
- The rates you can access. A higher score often opens the door to better interest rates.
That last point really matters for your wallet. The better the rate you secure, the less you pay each month, so keeping your credit score as healthy as possible could mean lower mortgage payments down the line.
Want a hand getting mortgage-ready?
Your credit score is just one piece of the puzzle, and a little preparation can go a long way. If you'd like to understand where you stand and how to put your best foot forward, our Cleerly advisers are here to help. We'll explain everything in plain terms and guide you towards the right deal, so you can apply with confidence.
11. Negotiate a 'Mortgage Holiday'
A mortgage holiday is when your lender agrees to give you a short break from making your repayments. It can offer welcome relief at a tricky time, though it's worth knowing that these breaks aren't as easy to arrange as they once were.
When a mortgage holiday could help
A payment holiday is designed to help you through a temporary dip in your finances. It can ease the pressure when life throws a curveball, such as:
- Maternity leave, when your income drops for a while, but you'll be back on your feet soon
- Redundancy, giving you some breathing space while you search for your next role
- Other short-term changes that affect your income for a set period
In moments like these, a pause on your repayments can make a real difference to your peace of mind.
The risks worth weighing up
A mortgage holiday can be a helpful lifeline, but it isn't free money. It's important to go in with your eyes open, because a break now can have knock-on effects later.
Here's what to keep in mind:
- Your overall debt will grow. Pausing your payments means interest keeps building, so you'll owe more on your mortgage by the time the break ends.
- Your future payments could rise. Once the holiday is over, you may face higher monthly repayments, or your lender might extend your mortgage term to spread the cost.
- It could affect your credit rating. Taking a payment holiday can leave a mark on your credit file, which may influence future borrowing.
None of this means a mortgage holiday is the wrong choice. It simply means it's a decision worth thinking through carefully, so you know exactly what to expect.
Not sure if it's right for you?
A mortgage holiday can be a sensible way to manage a temporary squeeze, but the best option always depends on your own circumstances.
If you'd like to talk it through, Cleerly's mortgage advisers are here to help. We'll explain your options in plain terms and guide you towards the choice that suits you, so you can move forward with confidence.
12. Don't forget Mortgage Protection and Buildings & Contents Insurance
Lowering your mortgage payments isn't the only way to free up cash each month. It's easy to set up your insurance once and forget about it, but those policies are often a quiet drain on your budget.
Take a moment to review what you're paying for your mortgage protection insurance, buildings cover, and contents cover. You may well find a cheaper deal that offers the same level of protection, and switching could trim your outgoings without leaving you any less covered.
Cleerly's Protection team are at hand to work out which cover suits you best. Our advisers are always happy to help, so you can make the right call with confidence.
Obligation-Free Mortgage Advice from Cleerly
In today's unpredictable mortgage market, waiting too long can pose risks to your financial security. Although it’s impossible to predict every rate movement, making informed decisions now can help you stay in control and protect your long-term interests.
Whether you're a first-time buyer, planning to move, or looking to remortgage, seeking prompt, professional advice from a trusted, whole-of-market broker like Cleerly is essential for safeguarding your financial future.
Our expert mortgage team is dedicated to offering clear, personalised guidance to ensure you secure the mortgage solution that best fits your financial circumstances. Your wellbeing and peace of mind is our highest priority. Don’t leave your financial future to chance, contact Cleerly today for experienced, trustworthy advice and explore your mortgage options with confidence.