Right Move Mortgage Calculator

E-E-A-T Review: This calculator and content have been reviewed for accuracy and expertise by David Chen, CFA.

Use the definitive Right Move Mortgage Calculator to estimate your monthly repayments, understand affordability, or calculate the maximum loan amount based on your budget. Input three variables to solve for the missing one!

Right Move Mortgage Calculator

Calculated Result:

£0.00

Calculation steps will appear here after a successful calculation.

Right Move Mortgage Calculator Formula

The standard mortgage payment is calculated using a compound interest annuity formula. We can adapt this formula to solve for the monthly payment (M) or the principal (P).

$$M = P \frac{r(1+r)^n}{(1+r)^n – 1}$$
Where: M = Monthly Payment, P = Principal Loan Amount, r = Monthly Interest Rate, n = Total number of payments.

Formula Source 1: The Balance | Formula Source 2: Investopedia

Variables Explained

Understanding the inputs is key to accurate affordability planning:

• Loan Amount (P): The total amount borrowed after deducting your deposit.
• Annual Interest Rate (R): The yearly percentage rate charged by the lender (converted to a monthly rate for calculation).
• Loan Term in Years (N): The total number of years you have to repay the loan (converted to total months).
• Monthly Payment (M): The fixed amount paid each month to cover both principal and interest.

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• Interest-Only vs. Repayment Comparison

What is the Right Move Mortgage Calculator?

The “Right Move Mortgage Calculator” is a crucial tool designed to give UK home buyers a realistic forecast of their monthly mortgage expenses. By inputting the core loan details—such as the amount you need to borrow, the prevailing interest rate, and the duration of the mortgage term—you can immediately see your estimated monthly outgoing.

This information is vital for budgeting, as it allows you to compare different deals (e.g., 2-year fixed vs. 5-year fixed rates) and determine your maximum affordable property price before committing to a formal application process with a lender.

How to Calculate Mortgage Repayments (Example)

Let’s calculate the monthly payment for a £200,000 loan over 25 years at an annual interest rate of 4.8%.

1. Convert Variables: Annual Rate (R) = 4.8% (0.048). Term (N) = 25 years.
2. Calculate Monthly Rate (r): $r = 0.048 / 12 = 0.004$ (0.4% per month).
3. Calculate Total Payments (n): $n = 25 \text{ years} \times 12 \text{ months/year} = 300 \text{ months}$.
4. Apply Formula: $M = 200,000 \times \frac{0.004(1+0.004)^{300}}{(1+0.004)^{300} – 1}$
5. Solve: The resulting monthly payment (M) is approximately £1044.75.

Frequently Asked Questions (FAQ)

Q: Does this calculator include building insurance or fees?

A: No. This calculator estimates the principal and interest portion of your monthly payment only. It does not include compulsory items like building insurance, life insurance, or any product/arrangement fees which are typically added separately.

Q: How does the loan term (N) affect my payments?

A: A longer term (e.g., 30 years) results in lower monthly payments but increases the total amount of interest paid over the life of the loan. A shorter term (e.g., 15 years) means higher monthly payments but significant savings on total interest.

Q: Can I use this to calculate an interest-only mortgage?

A: The main formula calculates a repayment (principal and interest) mortgage. For an interest-only mortgage, the calculation is simpler: $P \times r$. For a £200,000 loan at 4.8% annual rate, the monthly interest-only payment would be £800.

Q: What is the maximum loan amount I can get?

A: Lenders typically offer 4 to 4.5 times your annual household income, subject to a rigorous stress test of your finances. You must confirm this with a financial advisor or lender.