Creating your own overlays for papers is more about the creative process than any cut and dried techniques however this tutorial will walk you through the basics.
Create a new document 12x12 at 300ppi. When creating the new document, ensure that you have Transparent chosen as the Background Contents.

Use View> Fit to Screen to view the document in its entirety. Ensure that black is your default foreground color.
I’m going to start my overlay by choosing a brush set from SS Foliage Swirls available for free download at Obsidian Dawn This particular brush set has a variety of foliage shapes that is will use to create a creative pattern.
Choose the brush tool and load the brush set
Starting with the swirl brushes I change size, angles, and flip the direction of the brushes to create the first layer of the overlay.
I then created a new layer and used the floral brushes to add more to the bottom section of the design
And then a third to add detail to the top of the design
My next step is to vary the opacity of each layer slightly. I feel this gives the design a bit of depth.
The next task is to add some grunge around the edges of the design. Any grungy type brush will work for this. I’m using a brush set created by Dani B called Grunge Monkey. I’ve used the size, spacing and shape dynamic options. Create a new layer and brush the edges.
My final step is add further distress to the design.
Choose the Eraser brush from the tools palette and choose a different grunge type brush. Make adjustments as desired. I’m using a sanding brush from the Digital Distressing Brush Set available at ScrapArtist by Nancie Rowe Janitz. Use your selected brush to distress each layer of your design.

When you are satisfied with your design, hold CTRL and click on each layer to select them, right click and choose merge layers.
You can now save this design in native PSD to use and tweak again later or as png to preserve the transparency to use again or share with others.
You can either, open a paper from your collection and drag it on to the document (hold SHIFT key to center it) or you can create a new layer, fill with a solid color and move it below the design.
Manipulate the layer blending mode of the design to get the result you want.

You could also try coloring the overlay design with a gradient. Hold CTRL and click on the overlay thumbnail to select it.
Choose the gradient tool and select a default gradient or create your own.
Draw a line from diagonal to diagonal to fill the overlay.
Manipulate blending modes for the result you want.
You can also add text images and much more to an overlay. Let your imagination run wild!
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