Extend mortgage term and overpay?

[DuploTrain]

Short version:
Are there any unintended consequences of extending your mortgage term but then overpaying? (If you’re under the overpayment limit).

Details:
Mortgage deal ends in March 2024, currently 2.44% Will have 20 years and £125,000 left to pay.

Currently pay Approx £700 per month. We could overpay a few hundred a month but have been saving instead (5% savings account).

When we have to remortgage it will be 5% minimum. (£900/month). I was thinking of extending the term to 25 years, which reduces payments to £800/month.

We would then try to overpay by £100 or more. This would give us a buffer incase we struggle in a few years - could stop overpaying and/or reduce payments and use the overpayment reserve.

For context we have 1 toddler (childcare costs) and I’m pregnant, so mat leave and more childcare costs.

Am I missing a downside?

No I don't think so - if you think you might not be able to overpay at some point then obviously you will pay more overall, but this is what we have done to enable us to have a bit of breathing room if we need it at some point (we are actually "overpaying" into a savings account and not touching it which is more than our fixed rate at moment, but probably won't be at renewal)

Nope - we've extended the term to as long as we can as 45 year olds but know we will pay it off in around 12 years due to overpayments and, ultimately, pension lump sum. Yes you pay more interest if you extend the term but you're mitigating that to an extent by overpaying as your interest is calculated on the balance on a monthly basis.

It's a good strategy, main downside is if you don't overpay and spend the money on non-essentials instead and let the mortgage run the longer course, which will obviously be more expensive.

Glad to see people finally waking up to saving instead if the interest rate is higher on savings. Too many people on here were aggressively overpaying virtually interest free mortgages when in most cases it's money down the drain.