About this Mortgage Calculator UK
Mortgages in the United Kingdom work slightly differently than in the US. While US mortgages typically compound monthly, many UK lenders calculate interest daily but compound it annually (or monthly depending on the product). This calculator estimates your monthly repayment for a standard UK repayment mortgage.
Accuracy and testing
Review formula sources, default test cases, assumptions, unit handling, rounding rules, and changelog for this calculator.
How this calculator works
Inputs explained
Mortgage Amount
The total amount you are borrowing (Property Price - Deposit).
Interest Rate
The annual rate charged by the lender. Fixed deals (2-year, 5-year) are common.
Term
The total length of the mortgage, typically 25 to 35 years.
Understanding your results
Example scenarios
First Time Buyer
£200,000 mortgage at 5% for 30 years. Repayment: ~£1,073/mo. Interest Only: ~£833/mo.
Remortgage
£150,000 remaining balance at 4% for 15 years. Repayment: ~£1,109/mo.
Key Features
- UK Currency Support (£)
- Interest Only Comparison
- Standard Annuity Formula
Things to Keep in Mind
Does not calculate Stamp Duty Land Tax (SDLT). Assumes a constant interest rate for the entire term (which is rare in the UK).
Tips & Best Practices
- Most UK mortgages are fixed for 2 or 5 years. After that, you revert to the lender's Standard Variable Rate (SVR), which is usually higher. Plan to remortgage before the fixed term ends.
- Making overpayments can reduce your term and save thousands in interest. Check if your lender has limits (often 10% of balance per year).
Glossary of Terms
- LTV
- Loan to Value. The percentage of the property price you are borrowing. Lower LTV (e.g. 60%) gets better rates.
- Repayment Mortgage
- You pay both interest and capital each month. The loan is cleared at the end.
- Interest Only
- You only pay the interest. You must have a separate plan to repay the capital at the end.