Mortgage Calculator: How to Calculate Your Monthly Repayments
Kordu Team · 2026-03-31
Key Takeaways
- Monthly mortgage payments depend on three things: loan amount, interest rate, and term length.
- A 15-year term costs more monthly but saves over GBP 100,000 in interest vs a 30-year term on a GBP 250,000 loan.
- A 0.5% rate difference costs or saves tens of thousands of pounds over the life of a mortgage.
- Even GBP 100/month in overpayments can shave 4 years off your mortgage and save GBP 23,000 in interest.
Calculate Your Monthly Payment
Enter your loan amount, interest rate, and term to see your repayment, total interest, and full amortisation breakdown.
Loan details
Principal vs interest by year
Amortisation schedule
| Month | Payment | Principal | Interest | Balance |
|---|---|---|---|---|
| 1 | 1,535.22 | 389.39 | 1,145.83 | 249,610.61 |
| 2 | 1,535.22 | 391.17 | 1,144.05 | 249,219.44 |
| 3 | 1,535.22 | 392.96 | 1,142.26 | 248,826.48 |
| 4 | 1,535.22 | 394.76 | 1,140.45 | 248,431.72 |
| 5 | 1,535.22 | 396.57 | 1,138.65 | 248,035.14 |
| 6 | 1,535.22 | 398.39 | 1,136.83 | 247,636.75 |
| 7 | 1,535.22 | 400.22 | 1,135.00 | 247,236.54 |
| 8 | 1,535.22 | 402.05 | 1,133.17 | 246,834.48 |
| 9 | 1,535.22 | 403.89 | 1,131.32 | 246,430.59 |
| 10 | 1,535.22 | 405.75 | 1,129.47 | 246,024.85 |
| 11 | 1,535.22 | 407.60 | 1,127.61 | 245,617.24 |
| 12 | 1,535.22 | 409.47 | 1,125.75 | 245,207.77 |
Enter a loan amount and interest rate to see your monthly repayment and amortisation schedule.
How Mortgage Repayments Work
Every monthly payment has two parts: principal (what you borrowed) and interest (what the lender charges). Early on, most of your payment goes to interest. Over time, the balance shifts until most of each payment chips away at the principal.
This is amortisation — the reason your mortgage balance barely moves in the first few years, then drops faster towards the end.
The formula behind fixed-rate monthly payments:
M = P x [r(1 + r)^n] / [(1 + r)^n - 1]
Where P = principal, r = monthly interest rate (annual / 12), n = total monthly payments (years x 12). The calculator handles this for you.
How Interest Rate Changes Your Total Cost
The interest rate matters more than most people realise. Here is a GBP 250,000 mortgage over 25 years at different rates:
| Interest Rate | Monthly Payment | Total Interest Paid | Total Cost |
|---|---|---|---|
| 3.0% | GBP 1,185 | GBP 105,400 | GBP 355,400 |
| 3.5% | GBP 1,253 | GBP 125,800 | GBP 375,800 |
| 4.0% | GBP 1,320 | GBP 145,900 | GBP 395,900 |
| 4.5% | GBP 1,390 | GBP 166,900 | GBP 416,900 |
| 5.0% | GBP 1,462 | GBP 188,500 | GBP 438,500 |
| 5.5% | GBP 1,536 | GBP 210,800 | GBP 460,800 |
Going from 3.0% to 5.5% adds over GBP 105,000 in total interest on the same loan. Rate shopping is not optional.
Lock in your rate early
Most UK lenders let you lock a rate 3—6 months before completion. If rates are rising, this protects you. If rates fall before completion, many lenders let you switch to the lower rate.
15 vs 25 vs 30-Year Term Comparison
Same GBP 250,000 loan at 4.5%:
| Term | Monthly Payment | Total Interest | Total Cost | Interest Saved vs 30yr |
|---|---|---|---|---|
| 15 years | GBP 1,912 | GBP 94,100 | GBP 344,100 | GBP 106,400 |
| 20 years | GBP 1,582 | GBP 129,600 | GBP 379,600 | GBP 70,900 |
| 25 years | GBP 1,390 | GBP 166,900 | GBP 416,900 | GBP 33,600 |
| 30 years | GBP 1,267 | GBP 200,500 | GBP 450,500 | -- |
A 15-year term costs GBP 645 more per month but saves over GBP 106,000 in interest. If you can afford it, the shorter term is dramatically cheaper.
That said, a longer term with lower mandatory payments gives you breathing room if income fluctuates. You can always make voluntary overpayments to effectively shorten the term while keeping the safety net of lower required payments.
Fixed vs Variable Rate
Fixed rate locks your interest for a set period (typically 2, 3, 5, or 10 years in the UK). Payments stay the same regardless of the Bank of England base rate. When the fixed period ends, you fall onto the lender’s Standard Variable Rate (SVR) — almost always higher. Most borrowers remortgage before that happens.
Variable rate moves with the market. Trackers follow the base rate by a set margin (e.g., base rate + 0.75%). Discount mortgages reduce the lender’s SVR for a set period. Variable rates can be cheaper when rates fall, but your payments rise when rates do.
Rising rate environment: fix for certainty. Stable or declining rates: a tracker may save money. Neither is universally right — it depends on your risk tolerance and financial cushion.
Four Ways to Reduce Your Mortgage Cost
Overpay
Most UK mortgages allow up to 10% overpayment per year without early repayment charges. The effect is outsized because overpayments reduce the principal that future interest compounds on.
GBP 100 extra per month on a GBP 250,000 mortgage at 4.5% over 25 years saves roughly GBP 23,000 in interest and clears the mortgage nearly 4 years early.
Increase Your Deposit
A larger deposit lowers your loan-to-value (LTV) ratio, unlocking better rates. The biggest rate improvements happen at the 90%, 85%, 80%, and 75% LTV thresholds. If you are close to a threshold, finding the extra deposit pays for itself many times over.
Remortgage Before Your Deal Ends
Set a calendar reminder 6 months before your fixed or introductory period expires. Falling onto your lender’s SVR can cost hundreds per month. Start shopping 3—6 months early.
Shorten the Term at Remortgage
Each time you remortgage, check if you can drop the term. Going from 25 years to 22 may barely change your monthly payment if rates have improved, but it accelerates your payoff date significantly.
Compound Interest Calculator
Project how your savings grow over time with compound interest, monthly contributions, and different compounding frequencies.
Affordability stress testing
UK lenders stress-test your application at 1—3% above the rate you are applying for. Your maximum borrowing is based on affordability if rates rise, not just the current rate.
Make It Real
Play with the calculator above. Change the rate, adjust the term, add overpayments. See exactly how each variable moves the needle on your total cost. The best mortgage decision is the one you model before you sign.