Use our free calculator to assess your monthly mortgage repayments
A mortgage repayment calculator can tell what your monthly mortgage repayments will be based on real mortgage offers. Perhaps you have a current mortgage open and are looking for a new deal or you are a first time buyer looking for their first mortgage and want to know how much you will be repaying each month.
To use our mortgage repayment calculator, start by entering three simple details:
- How much you wish to borrow
- Interest rate
- How long you want to borrow the money for To estimate how much you wish to borrow, you need to calculate how much you can use as a deposit. This can include your own savings, your partner’s savings or money from family and friends that you can put towards a property. Then it is a matter of simply subtracting the deposit away from the value of your desired property.
Here is an example:
Property value is £250,000
Your deposit is £50,000
You will need to borrow £200,000
The average interest rate for 2015 varied from 1% to 3% (The Guardian). Lower interest rates are available to those with larger deposits, high credit scores or longer mortgage terms.
The typical mortgage offers you see online are presented for 2 to 5 years because rates will vary from year-to-year and it is common to remortgage and get a better deal. However, you can apply for mortgages for as long as 25, 30 or 40 years as this will give you longer to pay it off.
The Benefits of Using a Mortgage Payment Calculator
By using a mortgage payment calculator, you have the flexibility to change the figures and experiment with different mortgage deals. So if you are a looking at a number of different properties or are thinking how much you need to save up, a mortgage calculator lets you gain control of your finances.
By understanding your monthly repayments for a mortgage, you can start budgeting efficiently as you know how much you will need to spend each month. So using our mortgage calculator, you can find the best amounts and terms that work within your budget and get one step closer to finding the best mortgage for you.
How Mortgage Repayments Work
There are several different mortgage repayment methods but with a traditional mortgage repayment, you pay a combination of interest and capital. The interest is the rate charged by the lender based on the Bank of England Base Rate and their own rates. The capital is for paying off the cost of your property.
In a mortgage repayment, you will initially pay more interest and less capital in the first few years but towards the end of the mortgage term, you will be paying less interest and more capital.
This gives you the opportunity to pay off your capital early. If you have disposable income, inheritance or receive a bonus from work, you can always put this towards your mortgage repayments and this will bring down the cost of the capital. Be sure to check the terms and conditions of your mortgage agreement because some lenders charge a fee for paying early when you reach a certain amount.
Other Mortgage Repayment Methods
Interest only – this option allows you to pay just the interest on your mortgage every month and then it leaves your capital for one big repayment at the end of the loan term. So if you have a 25 year loan term, it gives you the opportunity to make small repayments for a number of years and then save up to make one repayment at the end, and this is very popular for first time buyers that need to save up.
Tracker – a tracker mortgage allows your interest rate to change as it is tracked to the Bank of England base rate and can fluctuate from year to year. Since a mortgage can last a few decades, having your interest rate tracked means that you won’t be worse off if the rate falls dramatically.
Offset – an offset repayment method allows you to create a little side pot where you can add savings at any time and use these to ‘offset’ your mortgage. By putting money into your offset account, the interest rate adjusts accordingly. It is completely tax-free to put money in the account and you can withdraw funds at any time. However, the more money in your offset account, the lower the interest rate will be.
Fixed Rate – a fixed rate mortgage means that the interest rate you pay every month and year remains constant and doesn’t change. Some homeowners who like to budget prefer this method as they want to know exactly what they are going to be paying every month, without any possibility of this changing.
Complete Our Form To Discuss Your Mortgage Requirements
Once you have filled in the amount you wish to borrow, interest rate and loan term on our form, we will give you an estimate of how much your monthly mortgage payments will be based on competitive mortgage deals available.
Then, by filling in a few basic details about the property and your contact details, we will get a mortgage advisor to get in touch to discuss your requirements and possible options. We are thrilled to be working with some leading mortgage providers in the UK and are passionate about getting the best mortgage for you.
Our mortgage calculator is completely free to use and we will not pass on your details without your permission. We simply take a small commission from the mortgage providers to ensure that our service is always free.
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