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Interest only mortgage calculators

Where can I find a reliable UK interest only mortgage calculator?

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Pete Mugleston

Author: Pete Mugleston - Mortgage Advisor, MD

Updated: June 29, 2022

Every week, we receive a number of enquiries relating to interest-only (IO) mortgages for residential property.


Many people want to know how much they can afford to borrow, how to calculate interest-only mortgage payments, and what the best UK interest-only residential mortgage repayment calculators to use are.

We work with IO mortgage specialists who offer bespoke advice and can help you in calculating your mortgage payments for interest-only deals. So if you’re wondering how do I calculate an interest-only mortgage payment? Look no further.

How do you calculate interest-only mortgage payments?

Lots of customers we speak to want to know exactly how lenders calculate interest-only mortgages.

The payment calculation for an IO mortgage is relatively simple. To determine your monthly interest-only loan payments, multiply the total amount you’re borrowing (including any fees that may be payable) by the annual interest rate, and divide by 12.

To do this you’ll need to convert the loan interest rate from a percentage into a decimal figure, by dividing the percentage by 100. So, an interest rate of 5% would translate to 0.05 (5/100).

For example, if you’re borrowing £200,000 at an interest rate of 5% over 20 years:

£200,000 x .05 = £10,000 per year of interest. £10,000 divided by 12 equals £833.34 per month, £10K per year, and a total of 200K across the 20-year term.

Assuming this is on a fixed interest rate, and provided you don’t make additional payments to start paying off the principal, your monthly payments should remain the same for the duration of the interest-only mortgage term.

Should I use a mortgage calculator for interest-only loans?

Calculators can be a great way to generate a quick idea as to what sort of rates and payments you can expect if you take out an interest-only mortgage.

They are also useful in comparing how the variables can fluctuate if you were to borrow a lesser or greater sum, and how your payments will vary based on different interest rates offered by providers.

However, they are not the best way to accurately calculate your mortgage repayments for an interest-only loan. Online tools can be incorrect, and may not factor in your individual needs or circumstances when assessing your interest-only mortgage affordability.

That being said, there’s no harm in running an online search to get a benchmark figure in mind before you speak to an expert. So, where’s the best place to find a mortgage payment calculator for interest-only loans?

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Where do I find an interest-only mortgage repayment calculator?

A good mortgage calculator will not only take into account the size of your loan, interest rate and term length, it will also consider your individual circumstances.

The property type and loan to value (LTV) should be brought into the equation, alongside your credit history, job type and age, because all of these factors will impact which providers will lend to you and the rates you’ll receive.

Our online tool is a simple, free mortgage calculator which includes an interest only setting. You can use this to work out how much your mortgage payments are likely to be, but keep in mind that even the best online calculators offer only a rough estimate of the mortgage deals on offer to you.

Be sure to contact us for further advice and assistance from one of the IO specialists we work with.

Speak to an advisor for an accurate interest-only mortgage calculation

Although it can be tempting to turn to an online repayment calculator when assessing your affordability for an interest-only mortgage, the results should not be used in isolation before you submit a loan application.

Experts recommend that you speak to a specialist if you want to secure the best deal. The whole-of-market brokers we work with have successfully arranged IO deals for hundreds of satisfied customers, and will carry out interest-only mortgage repayment calculations bespoke to your needs.

Make an enquiry today, or give us a call for a free, no obligation chat on 0808 189 2301. We only work with accredited brokers, and we’ve consistently been rated 5 stars on Feefo for advice and quality of service.

About the author

Pete, an expert in all things mortgages, cut his teeth right in the middle of the credit crunch. With plenty of people needing help and few mortgage providers lending, Pete found great success in going the extra mile to find mortgages for people whom many others considered lost causes. The experience he gained, coupled with his love of helping people reach their goals, led him to establish Online Mortgage Advisor, with one clear vision – to help as many customers as possible get the right advice, regardless of need or background.

Pete’s presence in the industry as the ‘go-to’ for specialist finance continues to grow, and he is regularly cited in and writes for both local and national press, as well as trade publications, with a regular column in Mortgage Introducer and being the exclusive mortgage expert for LOVEMoney. Pete also writes for OMA of course!

Read more about Pete

Pete Mugleston

Mortgage Advisor, MD

FCA disclaimer

*Based on our research, the content contained in this article is accurate as of the most recent time of writing. Lender criteria and policies change regularly so speak to one of the advisors we work with to confirm the most accurate up to date information. The information on the site is not tailored advice to each individual reader, and as such does not constitute financial advice. All advisors working with us are fully qualified to provide mortgage advice and work only for firms who are authorised and regulated by the Financial Conduct Authority. They will offer any advice specific to you and your needs.

Some types of buy to let mortgages are not regulated by the FCA. Think carefully before securing other debts against your home. As a mortgage is secured against your home, it may be repossessed if you do not keep up with repayments on your mortgage. Equity released from your home will also be secured against it.

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