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What are the Costs of Getting a Mortgage?
When you start thinking about applying for a mortgage, you will also begin to wonder what the cost will be. The cost of your mortgage will depend on many factors. We have discussed them in detail in this guide.
Usually the lender will charge you a non-refundable booking fee to reserve your chosen mortgage product. They will also charge you an arrangement fee, which can be added on to your loan amount. These two fees will vary from lender to lender.
You may be required to pay the legal fees to the solicitors for handling the conveyancing of your property.
Then there is the valuation fee that you will need to pay for the valuation survey which determines how much your property is worth.
The term of your mortgage will also add to your total mortgage cost. If you choose a shorter term of mortgage, you will pay more in monthly instalments but the cost will be cheaper in the long run. However, if you choose a longer term to get lower monthly repayments, it will cost more overall.
How Do I Calculate my Monthly Payment Instalments?
The easiest way to do this is to put all the relevant information in our Mortgage Repayment Calculator and the calculator will do the rest.
The information you will need to hand will be your loan amount, your preferred mortgage term and your interest rate. The calculator will let you know how much you will pay over the whole term of your mortgage and also give you the breakdown amounts of how much you will pay every month and how much you will pay in interest.
Here is an example of how the calculator works: if you wanted to borrow £200,000 over a 25-year period at an example mortgage rate of 2.25%, your monthly payments would be £1,090, assuming interest rates stay the same. The total amount you’ll pay over the term is £327,098, made up of the £250,000 capital you borrowed and £77,098 in interest.
Do remember though, the interest rate will not remain the same throughout the term of your mortgage. You will need to remortgage or do a product transfer with the same lender after your initial fixed rate mortgage period ends.
How much interest will I pay on my mortgage?
Your interest rate will depend on the type of mortgage deal you pick and won’t remain the same throughout your mortgage term, because mortgage deals last for a period of 2, 3 or 5 years mostly. After that you will need to switch to a new deal, either with your existing lender or with a new one.
Mortgage Repayment Calculator
Use our mortgage cost calculator to find out how much you will pay every month on your chosen mortgage deal. Just put in the details of the loan amount, term in years and the interest rate and the calculator will do the rest. You will know in a few seconds how much you will be expected to pay every month.
As our mortgage calculator tells you how much you will pay monthly assuming the interest rate stays the same, just input the changed interest rates to show you how you will pay when the interest rates change.
Changes in the Interest Rate of Your Mortgage
When your mortgage interest rate changes, it will cause changes in your monthly payments. If the rates increase, your payments will go up and vice versa.
You can make extra payments towards your mortgage loan capital.
More Mortgage calculators
Ever North Mortgages Limited has put together a collection of mortgage calculators to help you calculate how much you can borrow, your monthly mortgage payments, your stamp Duty and much more. See all our mortgage calculators here.