Mortgage payments, explained clearly
A repayment mortgage payment is calculated so that the loan and interest are paid off in equal monthly instalments over the selected term. At first, more of each payment goes towards interest; as the balance falls, more goes towards capital. An interest-only payment covers only that month's interest, leaving the full capital balance due at the end.
How your deposit changes LTV
Your loan-to-value ratio (LTV) is the mortgage divided by the property price. A larger deposit reduces both the amount borrowed and the LTV. Lenders often group products into LTV bands, but this calculator does not claim which products or rates you may qualify for.
Rate and term trade-offs
A longer repayment term can reduce the monthly payment but normally increases total interest because the balance remains outstanding for longer. A higher rate increases both monthly payments and total interest. The rate-rise figure above shows the same mortgage at one percentage point more, not a forecast.
Assumptions and limitations
- Interest is calculated monthly from the annual rate divided by 12.
- Repayment amounts use the standard capital-and-interest annuity formula.
- Figures are rounded to the nearest penny for display; annual figures are illustrative.
- Fees, APRC, changing rates, overpayments, payment holidays, tax and insurance are excluded.
- Interest-only borrowers need a separate credible plan to repay the capital.
Worked example
On a £300,000 home with a £45,000 deposit, a 4.5% repayment mortgage over 30 years means borrowing £255,000 at 85% LTV. Change those values above to see the estimated payment and full timeline.
Reviewed by the Properties & Homes editorial team
Last reviewed: 14 August 2026 · Methodology reviewed against the standard mortgage amortisation formula.
For independent guidance about mortgages and what you can afford, see the MoneyHelper mortgage guidance. Read our data and methodology approach.