Mortgage Calculator
Enter the property price, your deposit, the interest rate and the term to see what a repayment mortgage would cost each month. Add a monthly overpayment to see how much interest it saves and how many years it takes off the term.
How it works
A repayment mortgage is worked out with the standard annuity formula. Each monthly payment covers the interest that accrued that month, and whatever is left reduces the capital.
M = P × r ÷ (1 − (1 + r)^−n)
- M — the monthly payment
- P — the amount borrowed (price minus deposit)
- r — the monthly interest rate (annual rate ÷ 12 ÷ 100)
- n — the total number of monthly payments (years × 12)
Overpayments are handled by amortising the loan month by month rather than using the formula once, because every extra pound of capital repaid reduces all the interest that would have accrued on it afterwards.
Worked example
On a £300,000 property with a £45,000 deposit, you borrow £255,000 — a loan-to-value of 85%. At 4.5% over 25 years, the monthly payment is about £1,417, and you repay roughly £425,000 in total. About £170,000 of that is interest.
Overpay by £200 a month and the same mortgage clears in a little over 21 years, saving roughly £30,000 in interest.
That saving grows the earlier you start: the same £200 overpayment made from year one saves more interest than starting it in year ten, because it reduces the capital balance interest is charged on for longer.
Common questions
What interest rate should I use?
Use the rate on the deal you have been offered. If you are still looking, use the average rate for your loan-to-value band — the smaller your deposit, the higher the rate you will typically be offered.
Does this include fees, insurance or ground rent?
No. This shows the mortgage repayment only. Arrangement fees, buildings insurance, service charges and ground rent are all separate and should be budgeted on top.
What happens when my fixed rate ends?
You move onto the lender’s standard variable rate unless you remortgage. That rate is usually higher, so it is worth re-running this calculator with a higher rate to see what the payment would become.
Is there a limit on overpayments?
Most fixed-rate deals allow you to overpay up to 10% of the outstanding balance each year without penalty. Above that, an early repayment charge usually applies. Check your mortgage offer.
Why does a shorter term cost less overall but more each month?
A shorter term means each payment repays more of the capital, so less interest accrues over the life of the loan. The trade-off is a higher monthly commitment.
How much deposit do I actually need?
Most lenders ask for a minimum of 5-10% of the property price, but the rate you are offered improves in bands as your deposit grows — 15%, 25% and 40% deposits typically unlock progressively better rates, because the lender is taking less risk.
Does a bigger deposit always mean a lower rate?
Almost always, but the improvement isn’t smooth — lenders price mortgages in loan-to-value bands, so pushing your deposit just over a threshold (say from 24% to 25%) can unlock a noticeably better rate, while extra money below that threshold doesn’t help as much.