Mortgage repayment calculator
The monthly payment on a repayment mortgage, and what the loan costs you over its life.
- Amount borrowed
- £0
- Interest over the term
- £0
- Total repaid
- £0
Where the money actually goes
A repayment mortgage charges interest every month on whatever is still owed, then puts the rest of your payment against the balance. Early on the balance is almost the whole loan, so almost the whole payment is interest. Late on the balance is small, so almost the whole payment is capital. The monthly figure never changes, but what it buys does.
That is why the total is so much larger than the loan. On £200,000 over 25 years at 4.5% you repay roughly £333,000, and about £133,000 of that is interest. Nothing is going wrong; it is what borrowing for a quarter of a century costs.
The three levers, in order of power
The rate moves the payment most. A point on £200,000 over 25 years is around £110 a month, and about £34,000 over the term.
The term moves the total most. Stretching from 25 years to 30 lowers the monthly payment and raises the interest, because you are renting the money for five more years. Shortening does the reverse, which is the cheapest thing most people never consider.
The amount is the one you fix at the start and cannot revisit. A larger deposit is worth more than the same money overpaid later, because it never accrues interest at all.
What this does not include
Arrangement and valuation fees, buildings insurance, and any early repayment charge on a fixed deal. Nor does it assume a rate change: it runs the rate you enter for the whole term, which almost never happens in practice, since most people fix for two or five years and remortgage. Treat the total as what the loan costs if the rate held, not a forecast.
Common questions
- Why is the interest so much more than I expected?
- Because it is charged every month on whatever is still owed, and at the start almost nothing has been paid off. On a £200,000 loan over 25 years at 4.5%, about 40% of everything you hand over is interest. The share falls as the balance does, which is why overpaying early is worth far more than overpaying late.
- Is this what a lender will actually charge me?
- The payment is right for the balance, rate and term you enter. What a lender adds on top is arrangement and valuation fees, and buildings insurance if you take theirs. Those do not change the arithmetic here, they sit beside it.
- What happens when my fixed rate ends?
- The balance at that point is recalculated over the years left, at whatever rate you move to. Run this again with the balance you expect to have and the new rate to see the payment. A rate rise part-way through a term hurts more than the same rise at the start, because the term left is shorter to absorb it.
- Repayment or interest only?
- This is a repayment mortgage, where each payment clears interest and a slice of the balance, so the debt reaches zero at the end of the term. Interest only pays the interest and nothing else, so the payment is lower and the full balance is still owed on the last day.