Mortgage Calculator Credit Karma UK

Mortgage Payment Formula:

\[ M = P \times \frac{r \times (1 + r)^n}{(1 + r)^n - 1} \]

Monthly Payment (GBP):

Unit Converter ▲

Unit Converter ▼

From:	To:

1. What is a Mortgage Calculator?

Definition: This calculator estimates monthly mortgage payments based on loan amount, interest rate, and loan term.

Purpose: It helps UK homebuyers understand their potential mortgage payments when planning to purchase property.

2. How Does the Calculator Work?

The calculator uses the formula:

\[ M = P \times \frac{r \times (1 + r)^n}{(1 + r)^n - 1} \]

Where:

\( M \) — Monthly payment (GBP)
\( P \) — Loan principal (GBP)
\( r \) — Monthly interest rate (annual rate ÷ 12)
\( n \) — Number of payments (loan term in years × 12)

Explanation: This formula calculates the fixed monthly payment required to fully repay the loan over its term.

3. Importance of Mortgage Calculation

Details: Accurate payment estimation helps borrowers budget effectively and understand affordability before committing to a mortgage.

4. Using the Calculator

Tips: Enter the loan amount in GBP, annual interest rate (%), and loan term in years. All values must be > 0.

5. Frequently Asked Questions (FAQ)

Q1: Does this include taxes and insurance?
A: No, this calculates only the principal and interest payment. UK mortgages often have additional costs.

Q2: What's a typical UK mortgage term?
A: Most UK mortgages have 25-30 year terms, but shorter terms (15-20 years) are also common.

Q3: How does interest rate affect payments?
A: Higher rates significantly increase monthly payments. A 1% rate increase can add hundreds to monthly payments on large loans.

Q4: Can I calculate payments for different frequencies?
A: This calculator assumes monthly payments. Other frequencies require formula adjustments.

Q5: Does this work for interest-only mortgages?
A: No, interest-only mortgages use a different calculation method.