What this calculator does
A mortgage payment calculator turns a large borrowing decision into monthly numbers you can compare. Enter the property price, deposit, rate, term, repayment type and optional overpayment to test several scenarios before speaking to a lender.
Formula used
For repayment mortgages, the calculator uses the standard amortisation formula. For interest-only mortgages, the scheduled monthly payment is the monthly interest on the balance. Product fees can be added to the borrowing and voluntary monthly overpayments reduce the balance in the projection.
How to read the result
The monthly payment is still only part of affordability. Home insurance, service charge, ground rent, local taxes, product fees paid upfront, early repayment charges and future rate changes should be considered in a wider budget view.
Assumptions
- Assumes a fixed interest rate for the full term.
- Product fee is treated as added to the mortgage balance when entered.
- Monthly overpayments are assumed to be accepted without charge.
- Does not include insurance, tax, service charges, valuation fees, legal fees or early repayment charges.
Sources and checks
Source links are included so you can check important formulas, thresholds and assumptions.
Frequently asked questions
What is loan-to-value?
Loan-to-value, or LTV, is the mortgage amount divided by the property value. A lower LTV usually means more equity and may qualify for better rates.
Why does the term change interest so much?
A longer term spreads payments out, which lowers the monthly payment, but interest accrues for more months. That usually raises the total interest paid.