How to Use the UK Mortgage Calculator
Enter your property price, deposit amount, interest rate and mortgage term to see your monthly repayment instantly. Our UK mortgage repayment calculator works for both repayment and interest-only mortgages.
💡 Quick tip: Even a small rate change has a big impact. Try increasing the interest rate by 1% to see how much extra you'd pay if rates rise at renewal.
How Mortgage Repayments Are Calculated
For a repayment mortgage, the monthly payment is calculated using the standard amortisation formula, which ensures you pay off both the interest and capital over the full term:
Formula: Monthly Payment = Loan × [r(1+r)ⁿ] / [(1+r)ⁿ−1]
Where r = monthly interest rate, n = total months
Example: £240,000 loan, 4.5% rate, 25 years → £1,334/month
UK Mortgage Types Explained
| Type | How it Works | Best For |
|---|
| Fixed Rate | Rate locked for 2, 3 or 5 years then reverts to lender's SVR | Certainty and budgeting |
| Tracker | Follows Bank of England base rate + a set margin | When rates are falling |
| Variable / SVR | Lender sets the rate and can change it anytime | Short-term flexibility |
| Interest Only | Pay only the interest each month; capital due at end | Buy-to-let landlords |
| Offset | Savings offset against mortgage balance to reduce interest | Those with large savings |
Understanding LTV (Loan-to-Value)
LTV is the percentage of the property's value that you're borrowing. A lower LTV gets you better rates because the lender takes on less risk. Most first-time buyers start at 90–95% LTV (5–10% deposit), while the best rates are usually available at 60% LTV or below.
Advertisement — AdSense 336×280
UK Mortgage Affordability Rules (2026)
UK lenders must stress-test your mortgage to ensure you can afford repayments if rates rise by 3%. Key affordability rules:
- Maximum loan is typically 4–4.5× your annual income
- Lenders assess all monthly outgoings including loans and credit cards
- Self-employed buyers usually need 2–3 years of accounts
- Shared Ownership and Help to Buy schemes can reduce the deposit needed
Frequently Asked Questions
How much can I borrow for a mortgage in the UK? +
Most UK lenders will lend between 4 and 4.5 times your annual gross income. On a salary of £40,000 this means you could borrow £160,000–£180,000. Some lenders offer up to 5.5× for certain professions like doctors, lawyers and accountants. For joint mortgages, both incomes are combined.
What is a good monthly mortgage repayment in the UK? +
Financial advisers generally suggest your mortgage payment should not exceed 28–35% of your gross monthly income. For example, if you earn £4,000/month, keeping repayments below £1,400 is a sensible target. Use our calculator above to check your specific situation.
What is the average UK mortgage interest rate in 2026? +
In 2026, average UK 2-year fixed rates are around 4–5% and 5-year fixed rates are approximately 4.2–5.2%. Rates vary significantly by lender, your deposit size, credit history and property type. Always compare multiple lenders or use a mortgage broker.
What does LTV mean and why does it matter? +
LTV (Loan-to-Value) is the percentage of the property's purchase price you're borrowing. Lower LTV means a larger deposit — which gives you access to better interest rates. The best mortgage rates are typically available at 60% LTV or below. Most first-time buyers have an LTV of 85–95%.
What happens if I overpay my mortgage? +
Overpaying reduces your outstanding capital balance faster, which means you pay less total interest and can pay off your mortgage earlier. Most lenders allow overpayments of up to 10% of the outstanding balance per year without an early repayment charge. Always check your mortgage terms first.
How much deposit do I need to buy a house in the UK? +
The minimum deposit for most UK mortgages is 5% of the property price (95% LTV). However, a 10% deposit (90% LTV) gives you access to better rates and lowers your monthly payments. For the very best mortgage deals, a 25–40% deposit (60–75% LTV) is ideal.