Mortgage calculators

A mortgage is a large loan, typically from a bank or building society, that lets you borrow money to buy a property, like a house, flat or plot of land.

You repay the borrowed amount, plus interest, over an agreed time. This could be as long as 40 years with some lenders, depending on your age and what you can afford.

Your home acts as ‘security’ for your mortgage loan, which means that if you don’t keep up with repayments, the lender can sell the property to clear the debt.

It’s the regular monthly payment made by you (the borrower) to the lender (such as a bank) to repay the money you borrowed, plus any interest that applies.

You and the lender will work out when and how much you’ll pay each month when you take out your mortgage.

When you take out a mortgage loan, the lender charges you interest on the amount you borrow. This interest is a percentage of your loan amount and adds to your monthly mortgage repayments. 

If your mortgage interest rate changes, so will your repayments. Check you can afford your repayments if the rate increases.

There are two main types of mortgages:

• Fixed rate: The interest rate stays the same for a set time, usually 2 to 10 years.
• Variable rate: The interest rate can change. This includes tracker and discounted-rate mortgages.

And you can choose how to pay back the mortgage:

• Capital repayment: You pay back part of the loan and the interest each month.
• Interest-only: You pay only the interest each month and repay the loan at the end of the term.

There are pros and cons to each mortgage, so talk to a mortgage adviser to find the best option for you. You can also read our guide Understanding mortgages and interest rates.