Whether you are buying your first home or remortgaging, understanding exactly what your monthly payments will be is essential for budgeting. Our mortgage calculator gives you an instant breakdown of your repayments based on the property price, your deposit, interest rate, and chosen term. We also compare repayment and interest-only options side by side so you can see the true cost of each approach.
Calculate Your Mortgage Repayments
Interest-Only Comparison
Current Average UK Mortgage Rates (2026)
Interest rates are the single biggest factor affecting your monthly payments. Here are the typical rates available in early 2026, though the rate you are offered will depend on your LTV ratio, credit history, and the specific lender:
| Mortgage Type | Typical Rate | Best For |
|---|---|---|
| 2-year fixed | ~4.5% | Short-term certainty, planning to remortgage soon |
| 5-year fixed | ~4.2% | Medium-term stability, popular choice for most buyers |
| 10-year fixed | ~4.4% | Long-term security, protection against rate rises |
| Tracker (base rate + margin) | ~4.0% | Those who believe rates will fall, comfortable with variability |
| Standard variable rate (SVR) | ~7.5% | Avoid if possible — this is the default rate after a fixed deal ends |
Repayment vs Interest-Only Mortgages
Repayment Mortgages
With a repayment mortgage, each monthly payment covers the interest for that month plus a portion of the original loan amount (the capital). Over the term of the mortgage, you gradually pay off the entire debt. At the end of the term, you own the property outright with no remaining balance.
This is the most common type of residential mortgage and the safest option for most buyers. Your payments are higher than interest-only, but you are guaranteed to be mortgage-free at the end of the term.
Interest-Only Mortgages
With an interest-only mortgage, your monthly payments cover only the interest — you are not paying off any of the original loan. At the end of the term, you still owe the full amount you borrowed and must repay it in a lump sum.
Interest-only mortgages have much lower monthly payments, which can be appealing. However, they require a credible repayment plan — such as savings, investments, or the sale of another asset. Lenders are much stricter about who qualifies for interest-only mortgages, and many will not offer them for residential purchases at all.
How the Mortgage Term Affects Your Costs
The mortgage term is the number of years over which you repay the loan. A longer term means lower monthly payments but more interest paid overall. Here is how a £200,000 mortgage at 4.5% compares across different terms:
| Term | Monthly Payment | Total Repaid | Total Interest |
|---|---|---|---|
| 15 years | £1,530 | £275,340 | £75,340 |
| 20 years | £1,265 | £303,600 | £103,600 |
| 25 years | £1,111 | £333,400 | £133,400 |
| 30 years | £1,013 | £364,800 | £164,800 |
| 35 years | £945 | £397,100 | £197,100 |
The difference between a 25-year term and a 35-year term is £166 per month but £63,700 in total interest. If you can comfortably afford the higher payments, a shorter term saves a significant amount of money.
Tips to Reduce Your Mortgage Costs
- Save a larger deposit. Every 5% increase in your deposit typically moves you into a lower LTV band with better interest rates. See our deposit guide for strategies.
- Improve your credit score. A higher credit score gives you access to more products and better rates. Start working on this 6 to 12 months before you apply. See our credit score guide.
- Use a mortgage broker. Brokers access deals not available directly to the public and can often find rates 0.1% to 0.3% lower than you would find on your own. That small difference adds up over 25 years.
- Choose a shorter term if affordable. As shown above, even reducing from 30 to 25 years saves tens of thousands in interest.
- Make overpayments. Most mortgages allow you to overpay by up to 10% of the outstanding balance per year without penalty. Even small regular overpayments can shave years off your mortgage and save thousands in interest.
- Remortgage before your deal ends. When your fixed rate or introductory deal expires, you typically move onto the lender's SVR — which is almost always significantly higher. Start looking for a new deal 3 to 6 months before your current one ends. See our remortgaging guide.
Frequently Asked Questions
How much are monthly mortgage repayments on £250,000?
On a £250,000 repayment mortgage over 25 years at 4.5% interest, monthly repayments would be approximately £1,390. At 4.2%, they would be around £1,345. The exact amount depends on the interest rate, mortgage term, and whether you choose a repayment or interest-only mortgage.
What is the difference between repayment and interest-only?
With a repayment mortgage, your monthly payments cover both interest and a portion of the loan itself, so the mortgage is fully paid off at the end of the term. With an interest-only mortgage, you only pay the interest each month and the full loan amount remains due at the end of the term.
What are current UK mortgage rates in 2026?
As of early 2026, typical rates are approximately 4.5% for a 2-year fixed, 4.2% for a 5-year fixed, and 7.5% for an SVR. Rates vary by lender, LTV ratio, and your personal circumstances.
How does the mortgage term affect repayments?
A longer mortgage term reduces monthly payments but increases total interest paid. A £200,000 mortgage at 4.5% costs approximately £1,111 per month over 25 years (total interest £133,400) versus £945 per month over 35 years (total interest £197,100). The shorter term saves nearly £64,000 in interest.
Can I overpay my mortgage?
Most mortgage products allow you to overpay by up to 10% of the outstanding balance per year without penalty. Overpaying reduces your balance faster, which means less interest and an earlier payoff date. Always check your mortgage terms for the specific overpayment limit.
Related Guides
- Stamp Duty Calculator — calculate the tax on your purchase
- How Much Can I Borrow? — affordability calculator
- First-Time Buyer Guide 2026 — complete guide to buying your first home
- Deposit Guide — how much you need and where it can come from
- Fixed vs Variable Rates — which mortgage type suits you
- Mortgage Fees Explained — all the costs beyond your repayments