UK Mortgage Calculator
Compare repayment and interest-only monthly payments on a UK mortgage.
Two ways to repay
With a repayment mortgage each payment covers interest and part of the loan, so the balance reaches zero at the end of the term. With an interest-only mortgage you pay only the interest each month, so the payment is lower but you still owe the full loan at the end and need a plan to repay it.
Example
A £300,000 home with a 15% deposit means borrowing £255,000. At 5% over 25 years a repayment mortgage costs about £1,491 a month, and an interest-only mortgage costs £1,063 a month. The repayment mortgage costs roughly £192,000 in interest over the term.
Loan-to-value
LTV is the loan as a share of the price. A bigger deposit means a lower LTV, and lenders usually offer better rates at lower LTVs, often at steps such as 90%, 85%, 75% and 60%. Most UK deals have a fixed rate for two to five years, after which the rate changes, so test a higher rate to see how your payment could move.
Fees, Stamp Duty, insurance and valuation costs are not included. Use the Stamp Duty calculator for that cost.
Frequently asked questions
Is interest-only a good idea?
It suits a few situations, such as buy-to-let, but you must have a credible plan to repay the loan. Lenders check this carefully.
What happens when my fixed rate ends?
You usually move to the lender's standard variable rate unless you remortgage. Compare new deals a few months before the end.
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