Use this mortgage interest calculator to see how much of your mortgage payment is interest, how much interest you pay in the first year and over the whole term, and how your balance falls year by year.
Your mortgage interest
- Monthly payment
- –
- Interest in the first month
- –
- Interest in year 1
- –
- Total interest
- –
| Year | Interest paid | Capital repaid | Balance at year end |
|---|
On a £200,000 repayment mortgage at 4.5% over 25 years, you pay £1,111.66 a month. In the first month, £750.00 of that is interest. Over the full 25 years, the interest adds up to £133,499.
How mortgage interest is calculated
Lenders charge interest on the balance you still owe. Most UK lenders calculate it daily or monthly and add it each month. The monthly mortgage interest calculator here uses the monthly method:
Interest this month = balance owed × yearly rate ÷ 12
On £200,000 at 4.5%, the first month’s interest is £200,000 × 4.5% ÷ 12 = £750.00. The rest of your £1,111.66 payment reduces the balance, so next month’s interest is slightly lower.
Why you pay more interest at the start
In the early years your balance is at its highest, so most of each payment is interest. In year 1 you pay £8,909 in interest and only £4,431 off the loan. By the final year, you pay just £320 in interest and £13,020 off the loan.
| Year | Interest paid | Capital repaid | Balance at year end |
|---|---|---|---|
| 1 | £8,909 | £4,431 | £195,569 |
| 2 | £8,706 | £4,634 | £190,935 |
| 3 | £8,493 | £4,847 | £186,088 |
| 5 | £8,037 | £5,303 | £175,716 |
| 10 | £6,702 | £6,638 | £145,317 |
| 15 | £5,031 | £8,309 | £107,264 |
| 20 | £2,939 | £10,401 | £59,629 |
| 25 | £320 | £13,020 | £0 |
Mortgage interest rate calculator: how the rate changes the cost
Small changes in your rate make a big difference over 25 years. This table uses the same £200,000 loan:
| Rate | Monthly payment | Interest in year 1 | Total interest |
|---|---|---|---|
| 3.5% | £1,001.25 | £6,919 | £100,374 |
| 4% | £1,055.67 | £7,913 | £116,702 |
| 4.5% | £1,111.66 | £8,909 | £133,499 |
| 5% | £1,169.18 | £9,906 | £150,754 |
| 5.5% | £1,228.17 | £10,904 | £168,452 |
| 6% | £1,288.60 | £11,903 | £186,581 |
Each 0.5% on the rate adds roughly £55 to £60 a month on this loan, and around £16,000 to £18,000 in total interest.
How the term changes total interest
| Term | Monthly payment | Total interest |
|---|---|---|
| 15 years | £1,529.99 | £75,398 |
| 20 years | £1,265.30 | £103,672 |
| 25 years | £1,111.66 | £133,499 |
| 30 years | £1,013.37 | £164,813 |
| 35 years | £946.51 | £197,536 |
A longer term lowers your monthly payment but adds a lot of interest. Going from 25 to 35 years cuts the payment but adds tens of thousands of pounds in interest.
When your interest rate changes
On a fixed rate, your interest is predictable until the deal ends. On a tracker or variable rate, your payment changes when the lender’s rate moves, often after a Bank of England base rate change. MoneyHelper has tips on preparing for a rate change.
For example, after 5 years of the £200,000 mortgage above you would owe about £175,716. If your new rate were 6.5% instead of 4.5%, your payment would rise from £1,111.66 to about £1,310.09 a month. Running the mortgage interest calculator with a higher rate is a simple way to stress test your budget.
Interest on a mortgage vs other borrowing
Mortgage rates are usually far lower than credit cards or personal loans, because the loan is secured on your home. But mortgages last decades, so the total interest is large. Moving other debts onto your mortgage can lower the monthly cost but raise the total you pay, because you pay interest for many more years.
Ways to pay less mortgage interest
- Overpay. Every extra pound reduces the balance that interest is charged on. See the mortgage overpayment calculator.
- Remortgage before your deal ends so you do not drift onto a higher standard variable rate. Compare deals with the remortgage calculator.
- Choose the shortest term you can afford. You can often extend it later if money gets tight.
- Offset your savings against your mortgage, so you pay no interest on that part. See the offset mortgage calculator.
Mortgage interest calculator UK: interest-only option
Choose “Interest only” in the calculator to see the interest on an interest-only loan. The payment stays the same every month because the balance never falls. For a full comparison with repayment, use the interest only mortgage calculator.
Checking the interest on your statement
Your lender sends an annual mortgage statement showing the interest charged, the payments made and your balance. Compare the interest figure with the mortgage interest calculator result for the same year. A small difference is normal because of daily interest and payment dates; a large gap is worth asking your lender about.
Your statement also shows how much you could overpay without a charge, which helps you plan to cut your interest.
Frequently asked questions
How much interest will I pay on my mortgage?
It depends on the loan, rate and term. On £200,000 at 4.5% over 25 years it is about £133,499. Enter your own figures in the mortgage interest calculator above.
How do I work out monthly mortgage interest?
Multiply your current balance by your yearly rate and divide by 12. On £150,000 at 5%, that is £625 this month.
Why does my statement show slightly different interest?
Many lenders charge interest daily, so months with 31 days cost a little more than months with 30. The calculator uses equal months, so small differences are normal.
Is mortgage interest tax deductible in the UK?
Not on your own home. Landlords get a 20% tax credit on residential mortgage interest instead of a full deduction. See the rental income tax calculator.
About this calculator
This mortgage interest calculator builds a month-by-month schedule using the standard repayment formula and adds up the interest for each year. It assumes your rate stays the same. Results are estimates; your annual mortgage statement shows the exact interest charged.