UK Mortgage Repayment & Interest-Only Calculator
amp; Interest-Only CalculatorCompare a capital-repayment mortgage with interest-only on the same sterling loan. Default term is 25 years — the common UK planning period — not the 30-year US product on our PITI mortgage calculator.
Capital & Interest Repayment vs Interest-Only
Capital & Interest
- Total Interest:
- —
- Capital Repaid:
- —
- Total Lifetime Cost:
- —
Interest-Only Facility
- Total Interest:
- —
- Maturity Balance:
- —
- Total Lifetime Cost:
- —
As the loan matures, more of each payment goes to capital and less to interest.
—
—
Term Horizon & Equity Accretion Ledger (Capital Repayment vs Interest-Only)
Forecast capital balance and equity, assuming the property value stays flat.
| Year Milestone | Capital Monthly Pmt | Interest-Only Pmt | Remaining Capital Balance | Equity Accumulated | Remaining Interest-Only Balance |
|---|
When Does Interest-Only Make Sense in the UK?
Since the 2014 Mortgage Market Review, residential interest-only lending has been much tighter: lenders typically want a large deposit and a credible, evidenced repayment strategy — such as investments, pension lump sum or sale of another property. Interest-only remains common for buy-to-let, where rent covers the interest and the property sale is the planned repayment.
Check buy-to-let rental yieldRemortgaging & SVR Cliffs: Protecting Your Margin
When an initial fixed or tracker deal ends, most lenders move you onto their Standard Variable Rate, which is usually well above new-deal rates. Many lenders let you secure a new product several months before your deal expires, so you can switch without an early-repayment charge. The SVR line in the stress box above shows what drifting onto the SVR would cost.
Test a remortgage after feesHow this calculator differs from the US PITI page
The job on this page is a UK capital-repayment or interest-only estimate. The job on the US mortgage calculator is principal, interest, property tax and homeowners insurance (PITI), with a 30-year default and a PMI discussion. Those are different products. Merging them would hide the answer that actually changes.
- Term. 25 years is the default here. UK lenders also offer longer terms; use the selector. Do not assume 30 years.
- Repayment vs interest-only. Switching the product changes whether the balance falls to zero.
- No PMI line. UK high-LTV cost usually sits in the rate, not a separate US-style PMI premium.
- Purchase costs sit outside the monthly figure. Stamp Duty Land Tax, conveyancing, and broker fees are not mortgage instalments.
Formula
Capital repayment uses standard fixed-rate amortisation, the same mathematics banks use for a repayment mortgage:
M = P × [ i(1+i)^n ] / [ (1+i)^n − 1 ] — M = monthly repayment · P = loan · i = monthly rate · n = number of months
Interest-only is M = P × (annual rate / 12). The original loan is still due at the end unless you have a separate repayment vehicle. This page does not model that vehicle.
By Suhaib Hassan · Formula verified 27 Sep 2026 · Method v2.2-UK · How CalculatePilot verifies formulas →
A worked sterling example (pre-computed)
Property £300,000 · deposit £30,000 (10%) · loan £270,000 · rate 4.5% · term 25 years (300 payments). Figures use the same formula as the calculator, so the answer is readable if JavaScript is off.
Repayment, 25 years — monthly payment ≈ £1,500.75 · total repaid ≈ £450,224 · interest ≈ £180,224 · balance at the end = £0.
Interest-only, same loan — monthly payment ≈ £1,012.50 · interest over 25 years ≈ £303,750 if the rate never changes · balance still due at the end = £270,000.
Interest-only is cheaper each month and more expensive as a lifetime cost unless the £270,000 is repaid some other way. That trade-off is why this page is not a currency overlay of the US calculator.
What this monthly figure does not include
- Stamp Duty Land Tax (England and Northern Ireland) — a one-off purchase cost. Use the UK Stamp Duty Calculator for the 1 April 2025 residential bands, then confirm on GOV.UK.
- Land Transaction Tax / Land and Buildings Transaction Tax — Wales and Scotland use different regimes: Wales LTT and Scotland LBTT.
- Council tax, buildings insurance, ground rent, service charge — household costs, not lender repayment.
- Early-repayment charges and broker fees. (Product fees and the fixed-to-SVR switch are modelled above.)
For a regulated view of affordability, start with MoneyHelper’s mortgage calculators, then confirm with a lender quote.
Who should use the other mortgage page instead
- Anyone modelling US property tax plus homeowners insurance inside the monthly housing cost — that is the PITI calculator.
- Anyone who needs a full principal schedule — amortisation.
- Anyone modelling a monthly overpayment — UK mortgage overpayment.
Frequently asked questions
Why is the default term 25 years, not 30?
A 25-year term is still a common UK planning default. Many UK lenders also offer 30, 35 or 40 years depending on age and affordability. This page lets you change the term. The US PITI calculator on this site defaults to 30 years because that is the common US product, not because 30 years is universal.
What is the difference between repayment and interest-only?
A repayment (capital-and-interest) mortgage pays down the loan each month. An interest-only mortgage pays only the interest; the original loan is still due at the end unless you have a separate repayment vehicle. This calculator shows both on the same inputs.
Does this include Stamp Duty Land Tax?
No. SDLT in England and Northern Ireland is a one-off purchase cost, not a monthly mortgage line. Use the UK Stamp Duty Calculator for the 1 April 2025 residential bands, first-time buyer relief and additional-property surcharge.
Is PMI part of a UK mortgage payment?
Private mortgage insurance is a US product. In the UK, a high loan-to-value ratio usually means a higher interest rate, not a separate PMI line. Council tax, buildings insurance and ground rent are also separate from the lender repayment.
Are these figures a lender offer?
No. This is a planning estimate using the standard amortisation formula. Use MoneyHelper and a regulated adviser or lender quote before you commit.
Estimate only. UK repayment / interest-only · method v2.2-UK · last verified 27 Sep 2026 · sources and verification · who builds CalculatePilot
Next Calculation
Purchase taxes and mortgage tools for UK buyers.