Taking on a mortgage is often the most significant financial commitment one can make, but there are strategies to achieve substantial savings. One London resident, Marlon Wijeyasinghe, has found a way to save thousands on interest and shorten his loan term by utilizing a specialized app for mortgage overpayments.
In 2024, Marlon secured a £120,000 mortgage over 26 years and began using the Sprive app to monitor his spending and allocate affordable overpayments towards his mortgage. The app also offers cashback rewards through retailer gift card purchases, which can be directed towards mortgage repayments.
Marlon’s primary use of the cashback feature is for his Tesco grocery shopping. To date, he has saved an estimated £3,822 in mortgage interest and reduced his term by one year and two months. Continuing this approach may lead to projected savings of approximately £33,000 on interest and more than 11 years off his mortgage term.
Expressing his financial acumen, Marlon mentioned, “I buy gift cards through Sprive since the cashback I get on the gift card is essentially a discount on my shopping. I’ve always been efficient with my money and so I will use whatever platforms available to improve my efficiency.”
While using an app like Sprive can be advantageous for mortgage overpayments, direct communication with the lender for additional payments is also an option. Many mortgage providers allow overpayments up to around 10% of the outstanding balance annually without fees, although terms may vary.
Before making overpayments, it is crucial to consider factors such as maintaining an emergency fund equivalent to three to six months of essential expenses, clearing high-interest debts, and ensuring that overpayments reduce the actual mortgage debt, not just monthly payments. Balancing financial goals with necessary savings and prudent debt management is key to a holistic financial strategy.
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