Mortgage Repayment Calculator
Monthly payment, lifetime interest, overpayment impact, and rate stress test
Overpayment Impact
How an extra £/month overpayment changes everything
Rate Stress Test
Topic Hub
The Complete UK Mortgages Guide
Affordability, deposits, fixed vs variable, first-time buyer reliefs, remortgaging, and the April 2025 SDLT changes — all in one place, in plain English.
Understanding Mortgage Repayment for 2026/27
A UK mortgage repayment calculator shows you two things most people underestimate: how much interest you’ll pay over the life of the loan, and how dramatically overpayments reduce that total. A typical 25-year £250,000 mortgage at 5% costs roughly £188,000 in interest — more than three-quarters of the original principal again. Even small overpayments can save tens of thousands.
Most UK mortgages are repayment (capital and interest), where each monthly payment chips away at both the balance and the interest accruing on it. The early years of a repayment mortgage are heavily interest-weighted: on a fresh 25-year loan at 5%, roughly 72% of your first payment goes to interest and only 28% to capital. As the balance shrinks, this ratio flips — by year 15 most of each payment is repaying capital. Interest-only mortgages (still available for buy-to-let and some residential) keep the balance static and only service the interest each month, with the full balance due at the end of term.
The calculator above shows the full amortisation picture: monthly payment, lifetime interest, balance over time, and the impact of overpayments. It also includes a rate stress test — critical now that the Bank of England base rate has been volatile through 2024-2026 — so you can see what happens to your budget if your fix ends and you have to remortgage at a higher rate.
Key Figures for the 2026/27 Tax Year
- Standard UK term: 25-30 years
- Typical LTV ceiling (residential): 95%
- Bank of England base rate (April 2026): Variable — check current rate
- Most common UK fix length: 2-year or 5-year
- Overpayment limits (typical): 10% of balance per year during fix
- Interest-only affordability test: Lender requires credible repayment strategy
- Stress test (regulatory): Traditionally +3% above standard variable rate
How to Use the Mortgage Repayment Calculator
- Enter the loan amount (purchase price minus deposit).
- Enter the interest rate as a percentage (the rate you're offered or paying now).
- Enter the total term in years (usually 25-35 for first-time buyers).
- Choose repayment type: capital & interest (standard) or interest-only.
- Enter any monthly overpayment you plan to make.
- Review monthly payment, lifetime interest, total paid, and years saved by overpayments.
- Use the rate stress test to see what happens if rates rise 1-3% at remortgage.
Frequently Asked Questions
How much mortgage can I afford?
UK lenders typically multiply your gross annual income by 4.5x to determine maximum borrowing, with affordability stress-tested at higher rates. A couple with combined income of £80,000 might borrow up to £360,000 before deposit. However, the real affordability question is whether the monthly payment fits your budget after bills, savings, and life costs — aim for no more than 30-35% of take-home pay.
Should I overpay my mortgage or invest instead?
Generally, overpay if your mortgage rate is higher than the after-tax return you could reasonably expect from investments. At 5%+ mortgage rates, overpayment is often mathematically attractive compared to conservative investments. However, also consider: maintaining an emergency fund, maxing out ISA/SIPP tax wrappers, and keeping a float for flexibility. Always check early repayment charges on fixed-rate deals.
What is the difference between repayment and interest-only?
A repayment mortgage pays off both interest and capital each month, so the balance reduces until zero at the end of the term. An interest-only mortgage only pays the interest, leaving the full original balance to repay at the end — usually via investment returns, sale of another asset, or downsizing. Interest-only is now mainly used for buy-to-let and some high-net-worth residential lending.
How does a mortgage rate stress test work?
Lenders check whether you could still afford your monthly payment if rates rose significantly — traditionally 3 percentage points above the lender's standard variable rate. This protects borrowers from rate shocks when their fix ends. Our calculator runs the same stress test at +1%, +2%, and +3% so you can see your budget headroom.
What happens when my mortgage fix ends?
Your mortgage automatically moves to the lender's Standard Variable Rate (SVR), which is usually much higher than fixed rates. Most borrowers remortgage before the fix ends — either with the same lender ("product transfer") or a new lender ("remortgage") — to avoid the SVR. Start shopping 6 months before your fix expires.
Can I overpay during a fixed-rate period?
Most UK fixed-rate mortgages allow overpayments of up to 10% of the balance each year without triggering Early Repayment Charges. Anything above 10% typically attracts an ERC of 1-5% of the overpayment. After the fix ends, you can usually overpay as much as you want penalty-free. Always check your specific mortgage terms.
Related Calculators
- Remortgage Comparison Calculator — compare your current deal vs remortgaging, net of fees and ERCs
- BoE Rate Impact Calculator — see how BoE rate changes affect your monthly payment
- Stamp Duty Calculator — calculate SDLT / LBTT / LTT for your purchase
- Buy-to-Let ROI Calculator — full BTL analysis with Section 24 and Limited Company options
Official Sources
- Bank of England base rate (official source)
- MoneyHelper mortgage affordability guide
- FCA consumer mortgage guidance
Last reviewed April 2026. Figures and rules apply to the 2026/27 UK tax year. This tool is for guidance only and does not constitute financial advice.
