When purchasing a property in England, a mortgage is a loan secured against your home.
The monthly payment you make to your lender typically comprises two parts: the repayment of the principal loan amount and the interest charged on that loan.
This calculator helps you estimate your monthly outgoings based on key financial factors.
Key Factors Explained:
Property Price: The total cost of the home you intend to buy.
Deposit Amount: The initial sum of money you pay upfront towards the property price. This reduces the amount you need to borrow (the mortgage amount).
Annual Interest Rate: The percentage of the outstanding loan amount charged by the lender each year. Mortgage rates can be fixed for a period or variable, and they significantly impact your monthly payments and total cost.
Loan Term: The total duration, in years, over which you agree to repay the mortgage. Longer terms generally result in lower monthly payments but higher total interest paid over the life of the loan.
How the Calculation Works
The calculator uses the standard annuity formula to determine your monthly mortgage payment. The formula is as follows:
M = P [ i(1 + i)^n ] / [ (1 + i)^n – 1]
Where:
M = Your total monthly mortgage payment.
P = The principal loan amount (Property Price – Deposit Amount).
i = Your monthly interest rate (Annual Interest Rate / 12 / 100).
n = The total number of payments over the loan's lifetime (Loan Term in Years * 12).
The calculator first determines the loan amount (Principal). It then converts the annual interest rate to a monthly rate and the loan term in years to the total number of months. Finally, it applies the annuity formula to compute the fixed monthly repayment. The total repayment and total interest are then derived from this monthly payment.
3. Number of Payments (n): 30 Years * 12 Months/Year = 360 Months
Using the formula:
M = 240000 [ 0.0033333(1 + 0.0033333)^360 ] / [ (1 + 0.0033333)^360 – 1]
This calculation yields a monthly payment (M) of approximately £1,145.85.
Total Repayment: £1,145.85 * 360 = £412,506.00
Total Interest Paid: £412,506.00 – £240,000 = £172,506.00
Disclaimer: This calculator provides an estimate. Actual mortgage offers may vary based on your individual circumstances, lender policies, and current market conditions. It's always advisable to consult with a qualified mortgage advisor.
function calculateMortgage() {
var propertyPrice = parseFloat(document.getElementById("propertyPrice").value);
var depositAmount = parseFloat(document.getElementById("depositAmount").value);
var interestRate = parseFloat(document.getElementById("interestRate").value);
var loanTerm = parseInt(document.getElementById("loanTerm").value);
var resultDiv = document.getElementById("monthlyPaymentResult");
var totalRepaymentResultDiv = document.getElementById("totalRepaymentResult");
var totalInterestResultDiv = document.getElementById("totalInterestResult");
if (isNaN(propertyPrice) || propertyPrice <= 0) {
resultDiv.textContent = "Please enter a valid property price.";
totalRepaymentResultDiv.textContent = "";
totalInterestResultDiv.textContent = "";
return;
}
if (isNaN(depositAmount) || depositAmount < 0) {
resultDiv.textContent = "Please enter a valid deposit amount.";
totalRepaymentResultDiv.textContent = "";
totalInterestResultDiv.textContent = "";
return;
}
if (isNaN(interestRate) || interestRate 100) {
resultDiv.textContent = "Please enter a valid annual interest rate.";
totalRepaymentResultDiv.textContent = "";
totalInterestResultDiv.textContent = "";
return;
}
if (isNaN(loanTerm) || loanTerm propertyPrice) {
resultDiv.textContent = "Deposit cannot be more than the property price.";
totalRepaymentResultDiv.textContent = "";
totalInterestResultDiv.textContent = "";
return;
}
var principal = propertyPrice – depositAmount;
var monthlyInterestRate = (interestRate / 100) / 12;
var numberOfPayments = loanTerm * 12;
var monthlyPayment = 0;
if (monthlyInterestRate > 0) {
monthlyPayment = principal * (monthlyInterestRate * Math.pow(1 + monthlyInterestRate, numberOfPayments)) / (Math.pow(1 + monthlyInterestRate, numberOfPayments) – 1);
} else {
// Handle 0% interest rate case (though unlikely for mortgages)
monthlyPayment = principal / numberOfPayments;
}
var totalRepayment = monthlyPayment * numberOfPayments;
var totalInterest = totalRepayment – principal;
resultDiv.textContent = "£" + monthlyPayment.toFixed(2);
totalRepaymentResultDiv.textContent = "Total Repaid: £" + totalRepayment.toFixed(2);
totalInterestResultDiv.textContent = "Total Interest: £" + totalInterest.toFixed(2);
}