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Mortgage Calculator UK
Mortgage Amount - £
Interest Rate - %
Term - Years
Calculate

Full Monthly Payment

£788.61

Interest Only

£343.50

Months

300

Total Interest Payable

£56,581.78
Yearly Payment Breakdown
Year
Interest Paid
Capital Paid
Mortgage Balance
1
£4,065.58
£5,397.69
£174,602.31
2
£3,940.67
£5,522.60
£169,079.71
3
£3,812.86
£5,650.41
£163,429.30
4
£3,682.10
£5,781.17
£157,648.13
5
£3,548.32
£5,914.95
£151,733.18
6
£3,411.43
£6,051.84
£145,681.34
7
£3,271.38
£6,191.89
£139,489.45
8
£3,128.09
£6,335.18
£133,154.27
9
£2,981.48
£6,481.79
£126,672.48
10
£2,831.48
£6,631.79
£120,040.69
11
£2,678.01
£6,785.26
£113,255.43
12
£2,520.99
£6,942.29
£106,313.14
13
£2,360.33
£7,102.94
£99,210.20
14
£2,195.95
£7,267.32
£91,942.88
15
£2,027.77
£7,435.50
£84,507.38
16
£1,855.70
£7,607.57
£76,899.81
17
£1,679.65
£7,783.62
£69,116.18
18
£1,499.52
£7,963.75
£61,152.43
19
£1,315.22
£8,148.05
£53,004.38
20
£1,126.66
£8,336.61
£44,667.78
21
£933.74
£8,529.53
£36,138.24
22
£736.35
£8,726.92
£27,411.32
23
£534.39
£8,928.88
£18,482.44
24
£327.76
£9,135.51
£9,346.93
25
£116.35
£9,346.93
£-0.00
Monthly Payment Breakdown
Month
Interest Paid
Capital Paid
Mortgage Balance
1
£343.50
£445.11
£179,554.89
2
£342.65
£445.96
£179,108.94
3
£341.80
£446.81
£178,662.13
4
£340.95
£447.66
£178,214.47
5
£340.09
£448.51
£177,765.96
6
£339.24
£449.37
£177,316.59
7
£338.38
£450.23
£176,866.36
8
£337.52
£451.09
£176,415.28
9
£336.66
£451.95
£175,963.33
10
£335.80
£452.81
£175,510.52
11
£334.93
£453.67
£175,056.85
12
£334.07
£454.54
£174,602.31
13
£333.20
£455.41
£174,146.90
14
£332.33
£456.28
£173,690.63
15
£331.46
£457.15
£173,233.48
16
£330.59
£458.02
£172,775.46
17
£329.71
£458.89
£172,316.57
18
£328.84
£459.77
£171,856.80
19
£327.96
£460.65
£171,396.16
20
£327.08
£461.52
£170,934.63
21
£326.20
£462.41
£170,472.22
22
£325.32
£463.29
£170,008.94
23
£324.43
£464.17
£169,544.76
24
£323.55
£465.06
£169,079.71
25
£322.66
£465.95
£168,613.76
26
£321.77
£466.83
£168,146.93
27
£320.88
£467.73
£167,679.20
28
£319.99
£468.62
£167,210.58
29
£319.09
£469.51
£166,741.07
30
£318.20
£470.41
£166,270.66
31
£317.30
£471.31
£165,799.36
32
£316.40
£472.21
£165,327.15
33
£315.50
£473.11
£164,854.04
34
£314.60
£474.01
£164,380.03
35
£313.69
£474.91
£163,905.12
36
£312.79
£475.82
£163,429.30
37
£311.88
£476.73
£162,952.57
38
£310.97
£477.64
£162,474.93
39
£310.06
£478.55
£161,996.38
40
£309.14
£479.46
£161,516.92
41
£308.23
£480.38
£161,036.54
42
£307.31
£481.29
£160,555.25
43
£306.39
£482.21
£160,073.04
44
£305.47
£483.13
£159,589.90
45
£304.55
£484.06
£159,105.85
46
£303.63
£484.98
£158,620.87
47
£302.70
£485.90
£158,134.96
48
£301.77
£486.83
£157,648.13
49
£300.85
£487.76
£157,160.37
50
£299.91
£488.69
£156,671.68
51
£298.98
£489.62
£156,182.06
52
£298.05
£490.56
£155,691.50
53
£297.11
£491.49
£155,200.00
54
£296.17
£492.43
£154,707.57
55
£295.23
£493.37
£154,214.20
56
£294.29
£494.31
£153,719.88
57
£293.35
£495.26
£153,224.63
58
£292.40
£496.20
£152,728.42
59
£291.46
£497.15
£152,231.27
60
£290.51
£498.10
£151,733.18
61
£289.56
£499.05
£151,234.13
62
£288.61
£500.00
£150,734.13
63
£287.65
£500.95
£150,233.17
64
£286.69
£501.91
£149,731.26
65
£285.74
£502.87
£149,228.39
66
£284.78
£503.83
£148,724.56
67
£283.82
£504.79
£148,219.77
68
£282.85
£505.75
£147,714.02
69
£281.89
£506.72
£147,207.30
70
£280.92
£507.69
£146,699.62
71
£279.95
£508.65
£146,190.96
72
£278.98
£509.62
£145,681.34
73
£278.01
£510.60
£145,170.74
74
£277.03
£511.57
£144,659.17
75
£276.06
£512.55
£144,146.62
76
£275.08
£513.53
£143,633.10
77
£274.10
£514.51
£143,118.59
78
£273.12
£515.49
£142,603.10
79
£272.13
£516.47
£142,086.63
80
£271.15
£517.46
£141,569.17
81
£270.16
£518.44
£141,050.73
82
£269.17
£519.43
£140,531.29
83
£268.18
£520.43
£140,010.87
84
£267.19
£521.42
£139,489.45
85
£266.19
£522.41
£138,967.04
86
£265.20
£523.41
£138,443.63
87
£264.20
£524.41
£137,919.22
88
£263.20
£525.41
£137,393.81
89
£262.19
£526.41
£136,867.39
90
£261.19
£527.42
£136,339.98
91
£260.18
£528.42
£135,811.55
92
£259.17
£529.43
£135,282.12
93
£258.16
£530.44
£134,751.68
94
£257.15
£531.45
£134,220.22
95
£256.14
£532.47
£133,687.75
96
£255.12
£533.49
£133,154.27
97
£254.10
£534.50
£132,619.76
98
£253.08
£535.52
£132,084.24
99
£252.06
£536.55
£131,547.70
100
£251.04
£537.57
£131,010.13
101
£250.01
£538.59
£130,471.53
102
£248.98
£539.62
£129,931.91
103
£247.95
£540.65
£129,391.26
104
£246.92
£541.68
£128,849.57
105
£245.89
£542.72
£128,306.85
106
£244.85
£543.75
£127,763.10
107
£243.81
£544.79
£127,218.31
108
£242.77
£545.83
£126,672.48
109
£241.73
£546.87
£126,125.61
110
£240.69
£547.92
£125,577.69
111
£239.64
£548.96
£125,028.73
112
£238.60
£550.01
£124,478.72
113
£237.55
£551.06
£123,927.66
114
£236.50
£552.11
£123,375.55
115
£235.44
£553.16
£122,822.38
116
£234.39
£554.22
£122,268.16
117
£233.33
£555.28
£121,712.89
118
£232.27
£556.34
£121,156.55
119
£231.21
£557.40
£120,599.15
120
£230.14
£558.46
£120,040.69
121
£229.08
£559.53
£119,481.16
122
£228.01
£560.60
£118,920.56
123
£226.94
£561.67
£118,358.90
124
£225.87
£562.74
£117,796.16
125
£224.79
£563.81
£117,232.35
126
£223.72
£564.89
£116,667.46
127
£222.64
£565.97
£116,101.50
128
£221.56
£567.05
£115,534.45
129
£220.48
£568.13
£114,966.32
130
£219.39
£569.21
£114,397.11
131
£218.31
£570.30
£113,826.81
132
£217.22
£571.39
£113,255.43
133
£216.13
£572.48
£112,682.95
134
£215.04
£573.57
£112,109.38
135
£213.94
£574.66
£111,534.72
136
£212.85
£575.76
£110,958.96
137
£211.75
£576.86
£110,382.10
138
£210.65
£577.96
£109,804.14
139
£209.54
£579.06
£109,225.07
140
£208.44
£580.17
£108,644.91
141
£207.33
£581.28
£108,063.63
142
£206.22
£582.38
£107,481.25
143
£205.11
£583.50
£106,897.75
144
£204.00
£584.61
£106,313.14
145
£202.88
£585.73
£105,727.42
146
£201.76
£586.84
£105,140.57
147
£200.64
£587.96
£104,552.61
148
£199.52
£589.08
£103,963.52
149
£198.40
£590.21
£103,373.32
150
£197.27
£591.34
£102,781.98
151
£196.14
£592.46
£102,189.52
152
£195.01
£593.59
£101,595.92
153
£193.88
£594.73
£101,001.20
154
£192.74
£595.86
£100,405.33
155
£191.61
£597.00
£99,808.33
156
£190.47
£598.14
£99,210.20
157
£189.33
£599.28
£98,610.92
158
£188.18
£600.42
£98,010.49
159
£187.04
£601.57
£97,408.92
160
£185.89
£602.72
£96,806.21
161
£184.74
£603.87
£96,202.34
162
£183.59
£605.02
£95,597.32
163
£182.43
£606.17
£94,991.15
164
£181.27
£607.33
£94,383.81
165
£180.12
£608.49
£93,775.32
166
£178.95
£609.65
£93,165.67
167
£177.79
£610.81
£92,554.86
168
£176.63
£611.98
£91,942.88
169
£175.46
£613.15
£91,329.73
170
£174.29
£614.32
£90,715.41
171
£173.12
£615.49
£90,099.92
172
£171.94
£616.67
£89,483.25
173
£170.76
£617.84
£88,865.41
174
£169.58
£619.02
£88,246.39
175
£168.40
£620.20
£87,626.19
176
£167.22
£621.39
£87,004.80
177
£166.03
£622.57
£86,382.23
178
£164.85
£623.76
£85,758.47
179
£163.66
£624.95
£85,133.52
180
£162.46
£626.14
£84,507.38
181
£161.27
£627.34
£83,880.04
182
£160.07
£628.53
£83,251.51
183
£158.87
£629.73
£82,621.77
184
£157.67
£630.94
£81,990.84
185
£156.47
£632.14
£81,358.70
186
£155.26
£633.35
£80,725.35
187
£154.05
£634.56
£80,090.79
188
£152.84
£635.77
£79,455.03
189
£151.63
£636.98
£78,818.05
190
£150.41
£638.19
£78,179.85
191
£149.19
£639.41
£77,540.44
192
£147.97
£640.63
£76,899.81
193
£146.75
£641.86
£76,257.95
194
£145.53
£643.08
£75,614.87
195
£144.30
£644.31
£74,970.56
196
£143.07
£645.54
£74,325.03
197
£141.84
£646.77
£73,678.26
198
£140.60
£648.00
£73,030.26
199
£139.37
£649.24
£72,381.02
200
£138.13
£650.48
£71,730.54
201
£136.89
£651.72
£71,078.82
202
£135.64
£652.96
£70,425.85
203
£134.40
£654.21
£69,771.64
204
£133.15
£655.46
£69,116.18
205
£131.90
£656.71
£68,459.48
206
£130.64
£657.96
£67,801.51
207
£129.39
£659.22
£67,142.29
208
£128.13
£660.48
£66,481.82
209
£126.87
£661.74
£65,820.08
210
£125.61
£663.00
£65,157.08
211
£124.34
£664.26
£64,492.82
212
£123.07
£665.53
£63,827.29
213
£121.80
£666.80
£63,160.48
214
£120.53
£668.07
£62,492.41
215
£119.26
£669.35
£61,823.06
216
£117.98
£670.63
£61,152.43
217
£116.70
£671.91
£60,480.53
218
£115.42
£673.19
£59,807.34
219
£114.13
£674.47
£59,132.86
220
£112.85
£675.76
£58,457.10
221
£111.56
£677.05
£57,780.05
222
£110.26
£678.34
£57,101.71
223
£108.97
£679.64
£56,422.07
224
£107.67
£680.93
£55,741.14
225
£106.37
£682.23
£55,058.91
226
£105.07
£683.54
£54,375.37
227
£103.77
£684.84
£53,690.53
228
£102.46
£686.15
£53,004.38
229
£101.15
£687.46
£52,316.93
230
£99.84
£688.77
£51,628.16
231
£98.52
£690.08
£50,938.08
232
£97.21
£691.40
£50,246.68
233
£95.89
£692.72
£49,553.96
234
£94.57
£694.04
£48,859.92
235
£93.24
£695.36
£48,164.56
236
£91.91
£696.69
£47,467.86
237
£90.58
£698.02
£46,769.84
238
£89.25
£699.35
£46,070.49
239
£87.92
£700.69
£45,369.80
240
£86.58
£702.03
£44,667.78
241
£85.24
£703.36
£43,964.41
242
£83.90
£704.71
£43,259.70
243
£82.55
£706.05
£42,553.65
244
£81.21
£707.40
£41,846.25
245
£79.86
£708.75
£41,137.50
246
£78.50
£710.10
£40,427.40
247
£77.15
£711.46
£39,715.94
248
£75.79
£712.81
£39,003.13
249
£74.43
£714.17
£38,288.95
250
£73.07
£715.54
£37,573.42
251
£71.70
£716.90
£36,856.51
252
£70.33
£718.27
£36,138.24
253
£68.96
£719.64
£35,418.60
254
£67.59
£721.02
£34,697.58
255
£66.21
£722.39
£33,975.19
256
£64.84
£723.77
£33,251.42
257
£63.45
£725.15
£32,526.27
258
£62.07
£726.53
£31,799.74
259
£60.68
£727.92
£31,071.82
260
£59.30
£729.31
£30,342.50
261
£57.90
£730.70
£29,611.80
262
£56.51
£732.10
£28,879.71
263
£55.11
£733.49
£28,146.21
264
£53.71
£734.89
£27,411.32
265
£52.31
£736.30
£26,675.02
266
£50.90
£737.70
£25,937.32
267
£49.50
£739.11
£25,198.21
268
£48.09
£740.52
£24,457.69
269
£46.67
£741.93
£23,715.76
270
£45.26
£743.35
£22,972.41
271
£43.84
£744.77
£22,227.65
272
£42.42
£746.19
£21,481.46
273
£40.99
£747.61
£20,733.84
274
£39.57
£749.04
£19,984.81
275
£38.14
£750.47
£19,234.34
276
£36.71
£751.90
£18,482.44
277
£35.27
£753.34
£17,729.10
278
£33.83
£754.77
£16,974.33
279
£32.39
£756.21
£16,218.12
280
£30.95
£757.66
£15,460.46
281
£29.50
£759.10
£14,701.36
282
£28.06
£760.55
£13,940.81
283
£26.60
£762.00
£13,178.80
284
£25.15
£763.46
£12,415.35
285
£23.69
£764.91
£11,650.43
286
£22.23
£766.37
£10,884.06
287
£20.77
£767.84
£10,116.23
288
£19.31
£769.30
£9,346.93
289
£17.84
£770.77
£8,576.16
290
£16.37
£772.24
£7,803.92
291
£14.89
£773.71
£7,030.20
292
£13.42
£775.19
£6,255.01
293
£11.94
£776.67
£5,478.34
294
£10.45
£778.15
£4,700.19
295
£8.97
£779.64
£3,920.56
296
£7.48
£781.12
£3,139.43
297
£5.99
£782.61
£2,356.82
298
£4.50
£784.11
£1,572.71
299
£3.00
£785.60
£787.10
300
£1.50
£787.10
£-0.00

An Introduction to the UK Mortgage Market

How Big is the UK Mortgage Market?

Across the United Kingdom around 65 thousand to 70 thousand mortgages are approved each month. This is from a low of around 30 thousand after the global financial crisis of 2008 to 2009. Prior to the recession the monthly rate was closer to 80 thousand to 130 thousand loans completed per month. In the first quarter this amounted to £63.3 billion in new loan originations.

At the end of the first quarter of 2019 there were £1.355 trillion in unsecuritised home loans with £95.896 billion in securitised home loans. Overall residential loans to individuals summed to £1.451 trillion across 13,449,147 loans.

Market Composition

Around 92% of all mortgages used fixed rates in the first quarter of 2019, with the average fixed rate loan priced at 2.29%. The average variable rate loan was priced at 2.57%, bringing the overall market average to 2.31%.

60% of gross advances were made for home purchases, while around 1/3 of the market was for remortgage. Future advances & the other category round out the market at around 3% each. Breaking down the home purchase figures further, 19.2% were loans to first time buyers, 13.97% were for buy to let & 26.86% was classified as other.

Looking at new commitments, 54.9% were for home purchases, 38.93% were for remortgage & the other category (including further advances) comprised of 6.17% of new commitments.

Fixed & Variable Rates

The phrase "fixed rates" has a different meaning in different markets. In most markets around the world almost all mortgages are variable rate loans which are only fixed for a limited period of time at the beginning of the loan term.

The major exception to this rule of thumb is the United States market, where the Federal government heavily subsidizes the markets. Consumers have the ability to lock in a fixed rate for up to 30 years. The United States government backs Fannie Mae & Freddie Mac purchases of mortgage securities. In the US over 90% of borrowers opt for fixed-rate loans.

The UK also has government subsidy programs in Help to Buy and Help to Buy London. These programs offer down-payment assistance, though few lenders offer loans in the UK which have fixed rates extending beyond 5 years.

Most lenders across the UK will guarantee fixed rates for 2 to 5 years while structuring the remainder of the loan term to float using a variable rate which tracks a base rate from the Bank of England. The early fixed-rate portion of the loan often comes at a deal rate which has a lower spread. If market rates move higher when rates reset it can cause a large move in monthly payments.

Red Bus in front of the Bank of England.

For example, if one owed £180,000 and their rate went from 2.29% to 3.29% an interest only payment would jump from £343.50 to £493.50 while a full monthly payment would jump from £788.61 to £880.98.

In the UK about 92% of borrowers opt for fixed rates. 58% of borrowers opt for a 2-year deal period, while 32% opt for a 5-year deal period. Only 1 in 50 mortgages come with a fixed rate longer than 5 years. Many loans with a longer fixed period come with significantly higher rates & onerous early repayment charges.

Many borrowers across the UK refinance their loans when rates reset, which is a big part of why remortgages were recently nearly 40% of new commitments. Many loans contain upfront fees to help cover administrative costs & the costs of offering lower rates. Some loan terms prohibit advance repayments.

Downpayments & Credit Scores

Most borrowers who received funding had a substantial down-payment and did not have an impaired credit history. Only 0.62% of borrowers had loans with impaired credit history.

LTV stands for loan-to-value. It is a ratio of the size of the loan against the value of the dwelling. For example, if you had a £50,000 down payment saved up for a £200,000 home this would mean your loan amount would be £150,000. £150,000 divided by £200,000 is 75% LTV.

A tiny 0.2% of gross advances went to loans with an LTV over 95%, 4.34% went to loans with an LTV between 90% & 95%. 32.38% of advances went to loans between 75% & 90%, while 63.08% of gross advances went to loans with an LTV below 75%.

Lenders prefer to lend to borrowers with relatively low LTV values. If a borrower obtained funding at a 100% LTV then any weakness in the local property market could immediately expose the lender to potential losses. For this reason, borrowers in the highest LTV quartile may pay about a 1% higher APR than those in the lower half of the market.

The High Cost of Quick Decisions

Between 2015 and 2016 nearly one in three UK consumers opted for mortgage products which cost them more than £550 more per year than cheaper alternatives which they qualified for & were readily available. This fee difference amounts to 12.7% of what consumers spend annually on their mortgage.

The remortgage market is more competitive amongst lenders than the first time buyer (FTB) market, so only around 12% of borrowers in that category opted for strongly dominated product choices. About 18% of first time buyers fall into the strongly dominated product choice category & well over 20% of mover mortgages fall in this category. Movers who are in a rush often make emotionally-driven or time-sensitive choices which compromise their ability to get the best deal the way a person remortgaging can.

About 14% of borrowers in the top credit score quartile obtained strongly dominated products, while over 20% of consumers in the bottom quartile did. In general people who are young, have low incomes, have low credit scores, have a limited down payment and/or have other factors that make their transaction more complex like moving are more likely to get a worse deal on their loan.

Due to the large price difference between loan products, around 70% of borrowers seek independent intermediaries to help them compare loans instead of going directly to a lender. When comparing loans it is best to look at the total loan cost in Annual Percentage Rate (APR) instead of the interest rate in isolation, as the former gives you a multidimensional view which incorporates the full cost of financing inclusive of arrangement, valuation & survey fees along with any other expenses.

Arrears & Foreclosures

You are obligated to regularly pay your mortgage & if you fall behind the lender may seize the home.

0.99% of loan balance volume was in arrears at the end of the quarter while 1.35% of total loans were in arrears.

In the first quarter lenders took new position of 2,270 units, while selling off 1,751 units, leaving an ending stock of 3,820 units.

Reference Resources

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