🏠 Mortgage Calculator (UK)
Calculate your monthly repayment, total interest, and full amortisation schedule for any home loan.
A UK mortgage repayment is calculated using the standard amortisation formula M = P × [r(1+r)^n] ÷ [(1+r)^n − 1]. The Bank of England base rate drives variable products; fixed-rate deals price off SONIA swap rates. The FCA's Mortgage Conduct of Business handbook governs UK affordability rules. For a calculator that breaks down the true monthly cost including council tax and buildings insurance, see our mortgage calculator with tax and insurance.
UK mortgage maths in 2026 sits in a meaningfully different regime from the pre-2022 era of sub-2% rates. Borrowers refinancing from deals struck in 2018-2021 are landing in 4-5% products, and the affordability stress test embedded in lender models has materially compressed how much most households can borrow.
This calculator handles the four mortgage products UK borrowers actually use:
- Fixed rate (2, 5, 10-year) — most popular for owner-occupiers. Rate is locked, monthly payment doesn't move with BoE. Pricing is set against SONIA swaps plus a margin. For a dedicated 5-year fixed deep-dive with early-repayment-charge schedule and 5y-vs-2y total-cost comparison, see our 5-year fixed mortgage calculator
- Tracker — follows BoE base + a margin (e.g. base + 0.99%). No early repayment charge typically; risk if base rises
- Standard Variable Rate (SVR) — the lender's default after a fixed/tracker period ends. Almost always the most expensive product on the lender's book; refinance immediately on expiry
- Discount variable — SVR minus a margin for a fixed period; variants on tracker logic
- Specialist / adverse-credit products — for borrowers with CCJs, defaults, missed payments, IVAs, or ex-bankruptcy. Priced at a rate uplift over high-street pricing (mild +0.5-1.0pp, moderate +1.5-2.5pp, severe +3-5pp) and typically require a larger deposit. Model the cost on our UK bad-credit mortgage calculator
Beyond the headline rate, the calculator handles: - Capital repayment vs interest-only — capital repayment is the default for residential; interest-only is typically restricted to buy-to-let or high-net-worth lending - Term length — 25 years is standard, but 30-35 year terms are increasingly common to pass affordability. Extending term raises lifetime interest cost materially - Loan-to-value tiers — pricing steps at 60% / 75% / 85% / 90% / 95% LTV. Below 60% gets the best rates; 95% LTV (via the Mortgage Guarantee Scheme) carries the biggest premium - Affordability — lenders cap at 4-4.5x income, with lender-applied stress-testing against a higher reversion rate, typically 1-3 ppts above the product rate (the FCA's prescriptive SVR+1% test was withdrawn in August 2022) - Stamp Duty Land Tax — separate calculation; first-time buyers in England/NI pay no SDLT up to £300,000 and 5% on £300,001-£500,000, with no FTB relief above £500,000 (post-1 April 2025 reversion from the temporary £425k/£625k thresholds)
For underlying rules, the FCA's MCOB handbook governs UK mortgage advice and the Bank of England's monthly Money and Credit statistical release covers current SME and household lending rates. HMRC's Stamp Duty Land Tax calculator on gov.uk handles the SDLT calculation separately.
Calculate your monthly repayment, total interest, and full amortisation schedule for any home loan.
How is a mortgage payment calculated?
A standard fixed-rate mortgage uses the amortising annuity formula: M = P × r(1+r)n / ((1+r)n−1), where P is the loan amount, r is the monthly interest rate (annual ÷ 12), and n is the total number of monthly payments. Most of each early payment goes to interest; the principal share grows over time.
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How to use this calculator
Takes about 3 minutes.
- Enter the home price and your down payment
- Set the annual interest rate and the loan term in years
- Optionally add monthly property tax and home insurance to get a full PITI figure
- Click Calculate to see your monthly payment, total interest, and full amortisation schedule
- Adjust the down payment or term and recalculate to compare scenarios
Try these scenarios
Tap a scenario to load it into the calculator above.
Methodology & Sources
This calculator implements the standard mortgage amortisation formula: M = P × [r(1+r)^n] / [(1+r)^n − 1]. Region-specific tax and rate defaults are sourced directly from each country's primary government source and reviewed against the publication date below.
- USA: IRS — federal income tax brackets and contribution limits.
- UK: GOV.UK — HMRC personal allowance, National Insurance, and dividend rates.
- SA: SARS — personal income tax brackets and tax rebates.
Last verified: May 2026.
Key concepts
Principal vs. interest. Every mortgage payment is split between principal (reducing what you owe) and interest (the lender's fee). Early in a 30-year loan, most of each payment is interest; only after 15+ years does principal start dominating — this is the amortisation curve.
LTV (loan-to-value). Your loan divided by the home's price. A 20% deposit gives an 80% LTV. In the US, an LTV above 80% triggers Private Mortgage Insurance (PMI); in the UK, lower LTV typically unlocks better rates (FCA rules).
Fixed vs. variable rate. A fixed rate locks your payment for the fix period (typically 2, 5, or 10 years in the UK; whole-term in the US). A variable rate moves with central-bank policy — cheaper when rates fall, painful when they rise.
PITI and escrow. In the US, lenders often bundle property tax and homeowner's insurance into your monthly payment via an escrow account — Principal, Interest, Taxes, Insurance. The calculator's optional fields add these for a true monthly housing cost.
Total interest paid. Over a 30-year, $400k loan at 7%, you may pay more in interest than the home cost. Shortening to 15 years roughly halves total interest at the cost of a higher monthly payment.
UK mortgage market snapshot — 2026
The Bank of England's Monetary Policy Committee enters 2026 with the Bank Rate at roughly 4.0%, down from the 5.25% peak reached in August 2023. After holding through most of 2024, the MPC began a measured cutting cycle in 2025 as headline CPI converged back to the 2% target. Market pricing implied by the SONIA curve through Q4 2026 expects one or two further 25 bp cuts, conditional on services inflation continuing to ease and wage growth slowing toward 3-3.5%.
The post-September-2022 mini-budget rate spike is now well in the rear-view mirror, but its consequences linger: roughly 1.6 million UK fixed-rate mortgages contracted between 2020 and 2022 at sub-2% rates are still rolling onto 2026 product rates of 4.5-5.0% on 5-year fixes and 4.2-4.7% on 2-year fixes. A typical £200,000 borrower coming off a 1.75% deal at the end of a five-year fix faces a monthly payment increase of approximately £290 a month at a 4.75% reversion.
Lender pricing on fixed-rate products is set against SONIA (Sterling Overnight Index Average) swap rates plus a margin that covers the lender's funding cost, hedging, default loss assumption and required return on capital. The 2-year and 5-year SONIA swaps therefore matter more for new mortgage pricing than the Bank Rate itself: when markets price in faster cuts, fixes get cheaper before the MPC actually moves. Tracker mortgages, by contrast, follow the Bank Rate directly with a fixed margin (typically Bank Rate + 0.75-1.25%), so they only get cheaper after a cut is announced.
Standard Variable Rates in 2026 sit at 7.5-8.5% across high-street lenders — roughly 3.5-4.5 percentage points above competitive 5-year fixes. Falling onto SVR at the end of a fix is therefore the single most expensive mortgage decision a UK borrower can make. The remortgage market processes around 600,000 deals per quarter precisely because almost no fixed-rate borrower should rationally stay on SVR for more than the time it takes to complete a new application.
Regional UK house prices and worked mortgage payments
Average UK house prices in 2026 sit at approximately £290,000 nationally per ONS House Price Index data, but the dispersion across cities is wide enough that the same household income produces very different affordable property bands depending on geography. The table below shows, for eight representative UK cities, the average property price, the 10% deposit, the 90% LTV loan, and the monthly capital-repayment cost at the 2026 reference rate of 4.8% over a 25-year term. All payments are computed with the standard amortisation formula M = P × r(1+r)n / ((1+r)n − 1).
| City / region | Avg price | 10% deposit | Loan (90% LTV) | Monthly @ 4.8% / 25y | Total 25y cost |
|---|---|---|---|---|---|
| London | £540,000 | £54,000 | £486,000 | £2,784.77 | £835,429 |
| Bristol | £330,000 | £33,000 | £297,000 | £1,701.80 | £510,540 |
| Edinburgh | £290,000 | £29,000 | £261,000 | £1,495.52 | £448,656 |
| Cardiff | £250,000 | £25,000 | £225,000 | £1,289.24 | £386,772 |
| Manchester | £245,000 | £24,500 | £220,500 | £1,263.46 | £379,037 |
| Birmingham | £230,000 | £23,000 | £207,000 | £1,186.10 | £355,831 |
| Leeds | £220,000 | £22,000 | £198,000 | £1,134.53 | £340,360 |
| Belfast | £200,000 | £20,000 | £180,000 | £1,031.39 | £309,418 |
The London-vs-Belfast spread is striking: the same household pays 2.7x more per month for a 90% LTV mortgage in London than in Belfast, with a 25-year total cost difference of £526,011. Stamp Duty Land Tax compounds the regional gap: a London buyer at £540k pays £17,000 of SDLT (standard rate, not eligible for FTB relief because price exceeds £500k), while a Belfast FTB at £200k pays £0.
This regional dispersion is why the recovery plan recommends modelling your specific city before deciding on deposit size, term length, or fixed-rate horizon — a 25-year term that works comfortably in Belfast can quickly become unaffordable in London at the same income level. Plug your actual property price into the calculator above to overlay the regional table on your own numbers.
Fixed, tracker, or SVR — 2026 decision logic
Once you know your borrowing capacity and target loan amount, the next decision is which mortgage product type fits the rate environment. The 2026 landscape has shifted the trade-offs meaningfully versus the easy-money era of 2014-2021, and the right answer depends almost entirely on your view of the next 12-24 months of Bank Rate moves and your personal appetite for payment volatility.
5-year fixed. The dominant residential product in the UK and the most popular choice for owner-occupiers in 2026, currently pricing around 4.5-5.0% at 75% LTV on a typical £200,000 loan. The case for a 5-year fix is straightforward: rate stability through one or two MPC cycles, no remortgage admin or product fees for half a decade, and protection against any unexpected rate spike (the September 2022 mini-budget repriced 5-year SONIA by roughly 200 bp in days). The case against: if the MPC cuts faster than the SONIA curve expects, your 4.75% fix locks you out of the cheaper 2027-2028 products that would be available to a tracker borrower. For most households, the certainty premium is worth the option cost.
2-year fixed. Around 4.2-4.7% in 2026 — typically 25-40 bp below the equivalent 5-year fix because lenders are pricing in the expected MPC cutting trajectory. A 2-year fix is appropriate when (a) you expect to move or remortgage anyway within 2-3 years, (b) you have a strong directional view that rates will be materially lower in 2028, or (c) you want a low fix-period payment while you build equity for a better LTV tier at remortgage. The downside is product-fee turnover: paying a £999 fee every two years instead of every five compounds quickly on smaller loans.
Tracker. Usually priced at Bank Rate + 0.75-1.25%, so around 4.75-5.25% on a 75% LTV product in 2026. Trackers only beat fixed products on an expected-value basis if the MPC cuts the Bank Rate by more than the SONIA curve is already pricing in. They also typically carry no early repayment charge, which makes them genuinely useful as a short-term bridge: borrowers who plan to overpay aggressively, sell within 12 months, or want to wait for a specific 5-year fix re-pricing event often use a tracker as a deliberate parking product.
Standard Variable Rate (SVR). The lender's default rate after a fixed or tracker period ends. In 2026 SVRs sit at 7.5-8.5% across high-street lenders. Almost no borrower should choose SVR deliberately — it exists mainly to penalise inattention. The rare exceptions: a borrower in the final 12 months of a 25-year mortgage where the remaining balance is too small to justify product-fee economics, or a borrower with an imminent move where the early repayment charge on a new fix would exceed the SVR premium.
Discount variable. A lender-specific product priced at SVR minus a fixed discount margin for an introductory period (typically 2-3 years). The discount is large enough to compete with tracker pricing, but the underlying SVR is set unilaterally by the lender, so the borrower cannot independently verify that the SVR moves in line with the Bank Rate. For 2026, most informed borrowers prefer a tracker over a discount variable for the rate-transparency reason alone.
Use our dedicated 5-year fixed mortgage calculator for ERC schedules and 5y-vs-2y total-cost comparisons, or model adverse-credit pricing on the bad-credit mortgage calculator if your circumstances put you outside high-street pricing.
UK affordability and the stress test — worked example
UK lenders apply two layers of affordability assessment that compress the apparent 4.5x income headline. The first is the Prudential Regulation Authority's flow limit, which caps each lender's high-LTI (loan-to-income above 4.5x) lending at 15% of new mortgage flow. In practice this means most lenders set 4.5x as a hard ceiling for the majority of borrowers, with only a small specialist book of 5-5.5x loans available to high-income or strong-profile applicants.
The second layer is the FCA-permitted stress test. Since August 2022, lenders are no longer required to stress against SVR+1% as a regulatory floor — that prescriptive test was withdrawn — but every mainstream lender still applies an internal stress rate of roughly product rate + 1-3 percentage points, chosen to reflect a plausible rate-rise scenario over the fix period. The test asks: would the borrower's affordability model still pass if their payment reset to the stress rate?
Worked example — £50,000 joint income, target purchase £270,000 with 10% deposit:
- 4.5x income cap: 4.5 × £50,000 = £225,000 maximum borrow
- Product-rate monthly payment at 4.8% / 25y on £225,000 loan: £1,289.24
- Stress-rate monthly payment at 7.8% / 25y (product rate + 3pp): £1,706.88
- Gross monthly income: £50,000 ÷ 12 = £4,166.67
- Stress payment as % of gross income: £1,706.88 ÷ £4,166.67 = 41.0%
A stress payment at 41% of gross income clears most lenders' affordability gates (typical threshold 45-50%), so this borrower would be approved at the 4.5x cap. Below the 45% stress threshold, the practical borrowing capacity is roughly £247,000 — equivalent to 4.94x income — but the 4.5x flow-limit ceiling is the binding constraint, not the stress test. .
Two practical consequences flow from this: first, the stress test is less likely to be the binding constraint at lower interest rate environments (it bites hardest when product rates are already high), and second, lenders are notably more conservative on committed monthly outflows than headline-income arithmetic suggests. A £400/month PCP car finance agreement reduces a £50,000 joint-income borrower's practical capacity by approximately £21,600 because the affordability model treats the £4,800/year of contracted outflow as effectively removed from disposable income before the 4.5x multiple is applied.
The Mortgage Conduct of Business (MCOB) handbook also requires lenders to verify income via the most recent two-to-three months of payslips (or two to three years of accounts for self-employed borrowers), to apply the Mortgage Market Review (MMR) residual-income test for any borrower on a marginal affordability profile, and to refuse interest-only residential products unless there is a credible capital repayment strategy.
Remortgage timing and the fee-vs-rate trade-off
The single biggest remortgage decision is whether to pay a product fee to access a lower headline rate. Most UK lenders offer the same underlying product at two prices: a fee-paying option (typically £999, sometimes £1,495 or £1,999) at the lowest rate, and a fee-free option at a rate 15-30 basis points higher. The trade-off is purely arithmetic: at what loan size does the rate saving over the fix period exceed the fee?
Worked example — 2-year fix, 4.5% (£999 fee) vs 4.7% (fee-free), 25-year term:
- £200,000 loan: 4.5% monthly £1,111.66 vs 4.7% monthly £1,134.49; 2-year saving £547.81; net of £999 fee: −£451.19 (fee-free wins)
- £300,000 loan: 4.5% monthly £1,667.49 vs 4.7% monthly £1,701.73; 2-year saving £821.72; net of fee: −£177.28 (fee-free still wins)
- £400,000 loan: 4.5% monthly £2,223.32 vs 4.7% monthly £2,268.98; 2-year saving £1,095.63; net of fee: +£96.63 (fee version wins)
- £500,000 loan: net of fee: +£370.54 (fee version clearly wins)
The break-even loan size in this example is approximately £365,000 — below it, take the fee-free product; above it, the fee starts to earn its keep over the 2-year fix. The same calculation rerun over a 5-year fix tilts the maths in favour of the fee on smaller balances, because the rate saving accumulates over 60 months not 24.
Early Repayment Charges (ERCs). Most fixed-rate UK mortgages carry an ERC that tapers across the fix period — typical 5-year products are priced 5%/4%/3%/2%/1% of the outstanding balance for each year remaining. ERCs only apply during the fixed period; once you roll onto SVR or a tracker, you can repay without penalty. The strategic implication: remortgaging six months before your fix expires is almost always more expensive than waiting, because most lenders offer 3-6 month rate-lock-in windows that let you secure today's pricing without triggering an ERC on the outgoing deal.
Timing the next fix. If you believe the MPC is mid-cycle and rates will fall through 2027, a 2-year fix locks in the cutting trajectory faster than a 5-year fix. If you believe rates will stay flat through 2030, a 5-year fix maximises certainty and minimises product-fee churn. Most UK borrowers in 2026 default to a 5-year fix on the basis that 2027-2028 fixed-rate pricing is highly uncertain and the option cost of "wait and see" is non-trivial.
Buy-to-let UK mortgages — how they price and what lenders test for
Buy-to-let (BTL) mortgages price differently from residential mortgages even on identical properties. UK BTL rates typically sit 1.0-1.5 percentage points above residential rates at matching LTVs — so a residential 4.8% 5-year fix at 90% LTV would pair with a BTL 5.8-6.3% rate at 75% LTV. Maximum LTV is usually 75% (with a 25% deposit minimum), although some lenders go to 80% on standard residential property and a handful of specialist lenders dip to 20% deposit on prime properties for experienced landlords.
The decisive lender test on BTL is not income multiples — it is the Interest Cover Ratio (ICR). The ICR rule asks: at a stressed mortgage rate, does monthly rent cover the mortgage interest by a comfortable margin? PRA rules since 2017 require lenders to apply a stress rate of at least 5.5% or pay-rate + 2 percentage points, whichever is higher. The ICR ratio itself is 125% for basic-rate-taxpayer landlords and 145% for higher-rate landlords (or 145% across the board if the property is held in a limited company).
Worked example: a £250,000 buy-to-let purchase with a 75% LTV mortgage gives a £187,500 loan. At a typical 2026 BTL rate of 6.0% on interest-only terms, monthly interest is £937.50 (verify: 187,500 × 0.06 / 12). To pass the 125% ICR test stressed at 5.5%, the property must rent for at least £1,074/month (verify: 187,500 × 0.055 × 1.25 / 12). For a higher-rate landlord facing the 145% ICR test the rent floor rises to £1,246/month (verify: 187,500 × 0.055 × 1.45 / 12). If the local rental market does not support those rents, the deal is uneconomic at that LTV — landlords either bring in a larger deposit, target a cheaper property, or look at limited-company structures.
Tax treatment matters as much as the rate. Section 24 of the Finance (No.2) Act 2015, fully phased in by April 2020, removed the ability of personal-name landlords to deduct mortgage interest from rental income. Personal landlords instead receive a 20% basic-rate tax credit on interest, which leaves higher-rate (40%) and additional-rate (45%) landlords paying tax on a phantom profit. Limited-company landlords are unaffected — a Special Purpose Vehicle (SPV) deducts mortgage interest fully against rental income, pays corporation tax (25% from April 2023) on the residual profit, then faces dividend tax (8.75%/33.75%/39.35% from April 2026 across basic/higher/additional bands) on extracted profit. For higher-rate landlords with portfolios above two properties, the SPV route usually wins on a 10-year horizon despite the additional admin and ~£500-£1,000/year accountancy costs.
Frequently Asked Questions
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