Mortgage calculators help you understand how much you can borrow, the stamp duty tax, and what your mortgage repayments will be in the UK. Use a mortgage calculator if you're using Help to Buy, remortgaging, or investing with a buy to let to check your mortgage affordability, learn about overpayments, and how much interest you'll have to pay.
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Calculating how much you can borrow is the first step to getting a mortgage in the UK. If you're remortgaging, buying your first home, or investing in a buy to let property, you need to work out how much a mortgage lender may be willing to give you.
In the eyes of the mortgage lender, mortgage affordability is mainly down to two factors: the total income of the people applying for the mortgage, and your overall financial health.
The maximum most lenders will offer is five times the total income of the people applying for a mortgage. This varies from lender to lender, and it will also depend on the size of your deposit and the market value of your property.
If you have a bad credit score, or you have very high monthly outgoings, then lenders might give you a higher interest rate or refuse to give you a mortgage.
If you don't have a deposit of at least 5%, you will need to look at 100% LTV mortgages or guarantor mortgages. These mortgages have higher interest rates, and you will not generally be accepted unless you already have a mortgage with the lender or you have a guarantor.
If you're self employed, have bad credit, or you're looking to release equity from your home, then you should talk to a mortgage adviser to discuss your options.
Don't forget that the total cost of buying a house is much more than just saving up a deposit and getting a mortgage. Stamp duty, mortgage fees, conveyancy (legal) fees and surveys are likely to cost thousands of pounds. And that's before you spend any money renovating the new place or buying furniture!
Your monthly mortgage repayments are based on four things: the size of your mortgage loan, the length of the mortgage, the mortgage rate, and whether it's a repayment or interest only mortgage.
You will have to make monthly mortgage repayments for the entire length of your mortgage - usually 25 to 35 years. This is known as the mortgage term.
Our mortgage repayment calculator can help you quickly estimate the monthly cost of your mortgage.
Most mortgages, particularly if you're buying your first home or moving house, are repayment mortgages. This means that, every month, you repay some of the original mortgage debt. By the end of the mortgage term, you will have paid off the entire debt and own your home outright.
Interest only mortgages have much smaller monthly repayments because you only pay the interest. Then, at the end of the mortgage term, you still need to repay the full mortgage amount. Lenders won't give you an interest only mortgage unless you can prove that you can repay the whole loan at the end of the term.
Our Help to Buy mortgage calculator helps you work out whether an equity loan from the government can help you get onto the property ladder.
In the UK, especially in the south east, house prices are so high that most people don't have a high enough income to secure a mortgage.
Even if you can afford the monthly mortgage repayments, most lenders only will give you a maximum mortgage of five times your salary - which is problematic when house prices in the south east can be up to 15 or 20 times the average salary.
Help to Buy tries to bridge the gap. With Help to Buy Equity Loan, the government lends you up to 40% of the property price (20% outside of London), as long as you put down a deposit of 5%. You pay no interest for the first five years. When you sell the property, you pay the government back.
Help to Buy Shared Ownership lets you buy a share of a property and pay rent on the remainder. It's much easier to get a mortgage on a 25% share of a £400,000 property in London than on the full price. Over time, if your financial situation improves, you can increase your ownership share.
Calculating your stamp duty is the last thing you need to do, to fully understand whether you can afford to buy a house or not.
You must pay stamp duty (also known as stamp duty land tax or SDLT) on all house, property and land purchases in the UK. There are some exceptions for very cheap properties, or if you're a first time buyer. There is an extra 3% surcharge if you own multiple properties.
Stamp duty (also known as SDLT or stamp duty land tax) varies dramatically, depending on whether you're a first time buyer, moving home, or buying a second property (including buy to let). Stamp duty rates are different in England, Scotland, Wales, and Northern Ireland.
If you're a first time buyer in England or Northern Ireland, you'll pay no stamp duty at all on properties worth up to £300,000.
But if you want to buy a £500,000 property in London as a buy to let investment, the stamp duty would be £30,000!
You must pay stamp duty within 30 days of a property purchase, so you must factor it into your affordability calculations. For an expensive purchase, stamp duty could take a significant chunk out of your deposit.
Use our stamp duty calculator to understand the stamp duty rate you'll pay in, and to find out whether you qualify for first time buyer stamp duty relief or if you have to pay the 3% second home stamp duty surcharge.
Use our stamp duty calculator - or learn more about the stamp duty thresholds
A buy to let mortgage calculator can tell you roughly how much you borrow, based on the property value and your expected rental income.
Most buy to let mortgage lenders will want to see rental income that's at least 125% of the monthly mortgage payments. This provides a buffer for when the property is vacant, or if you have a problematic tenant who doesn't pay their rent on time.
You should also calculate how much tax you'll need to pay on a buy to let property. You'll likely need to pay a large amount of stamp duty, and the government is phasing out tax relief on buy to let mortgage payments.
Buy to let mortgages are usually interest only, meaning you can use our interest only mortgage repayment calculator to work out the monthly cost of a buy to let mortgage.
A mortgage overpayment calculator can show you how to pay off your mortgage earlier. You'll own your home outright sooner and, by reducing your interest payments, reduce the total cost of the mortgage.
There are two common ways to overpay on your mortgage: increase your monthly repayments - or with a big lump of cash, possibly from an inheritance or another source of money.
If you have a promotional interest rate on your mortgage - such as a 2 year fixed rate - then there will usually be a limit on how much you can overpay per year. Check with your mortgage lender to find out exactly how much you can overpay (usually it's around 10% per year).
Likewise, many mortgages have an Early Repayment Charge (ERC) if you completely pay off the mortgage before the end of your promotional interest rate period.
Depending on your circumstances, there are some other mortgage calculators that may help you understand the costs and affordability of buying property in the UK.
An LTV calculator is a quick way of working out your loan to value ratio - that is, how much you want to borrow versus the size of your deposit. Generally, the best mortgage rates are only available if you have an LTV of 60% or less. But if you can manage an LTV of at least 85%, you should be able to access some very competitive mortgage rates.
An equity release calculator gives you an estimate of how much money you may be able to release from your home with an equity release mortgage. Lifetime mortgages and home reversion mortgages are equity release mortgages that work in different ways.
If you don't have a mortgage and own your home outright, you can use that equity to get an equity release mortgage. In short, you are using equity in your home as a deposit to borrow money from a lender.
Equity release mortgages are complex products. You should talk to an adviser before getting one.
Some commercial mortgage calculators will let you compare business mortgages, which usually have a higher interest rate than residential mortgages.
An offset mortgage calculator tells you whether it's better to put your savings into a savings account, or into an offset mortgage.
If you keep your savings in an offset mortgage, you pay less interest on your mortgage debt.
If you keep your savings in a savings account, you earn interest on your savings.
An offset mortgage calculator can tell you which route will save (or make) you the most money over your mortgage term.
A second home mortgage calculator can help you work out if you can afford to buy a second property.
The rules for getting a mortgage on a second home are the same as your primary home. You'll need to save up a deposit and show that you can afford the monthly repayments. Your finances will be scrutinised to make sure you can afford mortgage repayments on more than one home.
In general, your total mortgage debt across all of your homes cannot be more than five times the total income of the people named on the mortgage.
If plan to rent out your second property, you will need a commercial mortgage or buy to let mortgage.
A second mortgage calculator can give you an estimate of how much you may be able to borrow with a second (also known as second charge) mortgage on your home.
Most self build mortgage calculators are very similar to standard residential mortgage calculators. A self build mortgage calculator can tell you how much you can borrow based on your income, and your monthly repayments depending on your much you borrow and the interest rate.
Self build mortgages are complex mortgage products. The mortgage lender does not usually give you one big lump of money to build a house. Instead, you receive parts of the mortgage loan for each of the different phases of building a house.
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Last updated: 8 August, 2019
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