The short answer
Borrowing and repayments are two calculations
A mortgage calculator combines income and deposit to illustrate borrowing, then uses the mortgage balance, interest rate and term to calculate monthly repayments and total interest.
Income and borrowing
How is income calculated for a mortgage?
This calculator deducts continuing monthly commitments from annual household income, then uses 4.5 times the adjusted income as an illustrative mortgage starting point. Lenders use their own fuller affordability checks.
Repayments
How are monthly mortgage repayments calculated?
For a repayment mortgage, the monthly payment is the fixed amount needed to repay the balance and interest across the selected number of monthly payments. A higher rate or shorter term normally increases the monthly payment.
Deposit and LTV
How do deposit and LTV affect the calculation?
The deposit is added to the mortgage to form the home budget. Loan to value, or LTV, is the mortgage divided by the property value. A larger deposit lowers the mortgage needed and may reach a lower illustrative rate band.
Buying and owning
What else does this calculator include?
Property tax follows the selected UK nation and buyer status. Buying fees remain separate from the deposit, while monthly costs identify the mortgage, repairs, bills and any known service charge.
Source register
Current assumptions
Illustrative assumptions are labelled; maintained rules link to their source.
- Borrowing starting point
- 4.5× household incomeIllustrative product assumption; not a lender policy
- Maximum LTV
- 95% maximum illustrative LTVMost mortgages require at least a 5% deposit; specialist 100% products are excluded
- Illustrative rates
- 4.61%–5.49% starting illustrative rate by LTVBank of England weighted quoted rates for two-year fixed mortgages
- Repayment term
- 30-year starting repayment termIllustrative product assumption
- Monthly commitments
- Continuing monthly commitments are deducted from annual income before the 4.5× illustrationFCA rules require lenders to account for committed expenditure, but each lender uses its own affordability method
- Buying fees
- £5,000 starting legal, survey, mortgage and moving allowanceMoneyHelper says buyers could spend over £5,000 excluding deposit and property tax; this is an illustrative allowance, not a quote
- Repairs and upkeep
- 1% of property value each year for repairs and upkeepMoneyHelper's average repair-bill planning figure for new homeowners; this is a rough allowance, not a bill
- Household bills
- £415 monthly starting allowance for Council Tax, utilities, insurance and broadbandIllustrative starting amounts; edit them for the property
- SDLT · England and Northern Ireland
- Current official rulesOfficial rates and bands
- LBTT · Scotland
- Current official rulesOfficial rates and bands
- LTT · Wales
- Current official rulesOfficial rates and bands
Limits and corrections
Useful, not a promise
The estimate does not assess credit history, employment evidence, property suitability or an individual lender's policy. Complex property-tax cases need the official calculator.