This article is all about £150,000 mortgages, specifically how much the repayments are for one, how much deposit you’ll need, and getting the best rates available.
Here at Online Mortgage Advisor, we get countless enquiries about mortgages of this amount, and since the advisors we work with are whole-of-market, they’re best positioned to help you find the right deal for someone in your circumstances.
Customers often ask us ‘what are the average repayments on a £150K mortgage?’, and the answer depends on a number of factors - all lenders are different, and your credit history will have a bearing on the interest you’ll pay, which of course will directly affect your monthly repayments.
A £150K mortgage’s monthly repayments will vary depending on the interest rate you’re given as well as the length of the term. The table below (approximate figures) illustrates how £150k mortgage payments can differ based in these variables.
Which rate you qualify for will depend mostly on your level of deposit and your profile as a borrower. If you’re still unsure about the cost of a £150k mortgage, get in touch and the expert advisors we work with will clear up any confusion and connect you with the lender most likely to offer favourable rates to somebody in your circumstances.
Does the term of the mortgage affect repayments and the total amount you’ll repay?
The short answer is, yes. We’re often asked, how long does it take to pay off a £150,000 mortgage? This all depends on your circumstances and how much you can afford to pay each month.
Based on an average interest rate of 3%, the following is an indication of how reducing the term of your mortgage will affect your repayments and total amount you’ll repay.
150k mortgage over 30 years
150k mortgage over 25 years
150k mortgage over 20 years
150k mortgage over 15 years
150k mortgage over 10 years
150k mortgage over 5 years
The above example is for demonstrative purposes only and you should consult your broker or lender for the most up-to-date information and rates.
As you can see, the term of the mortgage has a huge bearing on your monthly repayments and how much you’ll finally pay.
For instance, taking a mortgage over a 20 year term, as opposed to a 25 year term could save you over £13,700.
Talk to one of the expert mortgage advisors we work with for the right advice on which term may be the most beneficial for your circumstances.
How much do you need to earn to get a mortgage for £150 000?
Another common question we hear is ‘how much household income do I need for a £150k mortgage? and this very much depends on a number of eligibility factors, such as how you earn your income, your credit history and how much deposit you have.
The answer is either simple or more complex depending on your individual circumstances.
How much deposit is needed for a 150k mortgage?
Mortgage lending is based on how much you want to borrow in relation to the value of the property. This is known as the loan-to-value (LTV) ratio.
If you put down a £15,000 deposit on a property worth £150,000, then you own 10% outright and need to borrow 90%. This means your LTV ratio is 90%.
The current minimum deposit is 5% or 95% LTV (Loan to Value) for residential mortgages. So for a mortgage on a £150,000 home, you’ll need to raise at least £7.5K for a deposit.
Can I get a £150,000K mortgage with no deposit?
There are 100% mortgages available, but these are often limited to family mortgages where a family member, usually parents, deposit the equivalent of the deposit into an account with the lender as security. After an agreed period of time (often three years) and certain criteria have been met, they can get their money back.
If you’re having trouble raising a deposit, there are also government Help to Buy schemes and shared ownership to consider.
Does bad credit affect how much deposit I need on a £150k Mortgage?
The short answer is yes. If you’ve had bad credit, lenders will see you as a greater risk and the worse your history, the greater risk you’ll be seen as; so a larger deposit will be needed.
Credit issues may include…
No credit history
Low credit score
Missed mortgage payments
Debt management Schemes
Multiple credit problems
All lenders are different, so may require different deposits (or Loan to Value) depending on your circumstances and how they access the risk.
For instance, if you’ve relatively light bad credit (low credit score, late payments etc), some lenders may be happy with a smaller deposit and higher LTV.
But if your credit history includes more serious matters, such as a repossession or bankruptcy, then they may insist on a larger deposit to provide a lower LTV, which means a lower risk to the lender.
So depending on your perceived risk to the lender, you may be required to provide a proportionately higher deposit.
The above is for demonstrative purposes only and you should consult your broker or lender for the most up-to-date information and rates.
We touch on bad credit history further into this article, but if you’re unsure if your credit history will be an issue, talk to one of the advisors we work with today, they’re experts when it comes to finding mortgages for people with bad credit. For more information on this visit our dedicated bad credit mortgages page.
Can I get a £150,000 buy to let mortgage?
Yes, of course, but the rules can be different for BTL mortgages, so it’s important to know a few things before you start.
Some lenders will expect you to put down a higher deposit of around 25%, although others will accept 15% subject to other criteria. You may also find that certain providers insist on minimum income requirements - around £25k is standard – although affordability come down to whether the forecast rental income will cover the mortgage repayments by 125-130%.
There are also lenders who will only offer you a BTL deal if you have owned and lived in your own home from at least six months, but specialist providers may consider first-time buyers subject to other criteria being met.
The majority of buy to let mortgages are set up on an interest only basis, so see the section below for examples of what the monthly payments on a £150,000 mortgage might be.
Can I get a £150,000 mortgage as interest only?
Yes, many lenders offer these products to residential borrowers who can evidence a valid and viable repayment strategy.
Generally, to qualify for an interest only mortgage you also need a slightly larger deposit, as most lenders will only consider up to 75% Loan to value (LTV), with a few going up to 80%, and a handful up to 85% in the right circumstances.
Interest only mortgages can have benefits over repayment agreements - the lower monthly cost being the main one.
With an interest only agreement, the borrower only pays off the interest each month and the full loan amount is due at the end of the term. With a repayment, you chip away at the loan itself and pay the mortgage as you go.
The table below shows how mortgage repayments on a £150,000 loan compare - Interest Only vs. Repayment based on 4% interest.
Make an enquiry and the experts we work with provide this information over the phone and connect you with the right lender.
Other factors that may affect a £150,000 mortgage application
Whether your £150,000 mortgage application is successful may also depend on a number of other factors in addition to your credit rating (see above), including…
The property type: Some mortgage refuse to lend on properties with non-standard construction (e.g. thatched roof, timber frame) while others consider them higher risk and offer less favourable rates. Find out more about non-standard construction mortgages here.
Your age: Some providers impose age limits on their mortgages and won’t lend to anyone over 75. At others it’s 85, and a minority won’t set an upper age limit if they’re confident you can make the repayments post-retirement.
Your income type: Those with a big, juicy PAYE salary from a full-time job are most desirable to lenders. Anything else usually falls into the non-standard income niche, which potentially means less favourable rates. However, there are specialist lenders who cater for self-employed borrowers, as well as those who supplement their earnings with things like bonuses and benefits. Find out more about income types and mortgages here.
Whether you already own property: Some lenders will consider you a slightly higher risk if you already own a home and are buying a second home to live in part time somewhere else. You may need more deposit as well as meet additional higher minimum income requirements, and there could well be greater scrutiny around affordability.
Your credit rating: It is still possible to get a mortgage if you have bad credit, depending on the severity of the issue (a missed phone bill payment is less severe than a recent bankruptcy, for instance) and how long it has been on your file (the longer, the better). Bad credit customers may require a specialist lender who is more sympathetic to their circumstances, which is why whole-of-market advice is so important. Read for about bad credit mortgages here.
£150,000 mortgages for self-employed borrowers
It is possible to secure a mortgage if you’re self-employed, but you may need a specialist lender to get the best rates as some will consider your income non-standard, and therefore offer you a less favourable deal due to the perceived risk.
The income lenders usually accept is…
Employed: Gross basic income - bonus - overtime - commission - car / town / shift allowances - mortgage subsidy - other cash employer benefits.
Net profit (if using accounts) - Total income received (if using SA302s).
Partnership: Your share of net profit (if using accounts) - Your share of total income received (if using SA302s).
Your share of director’s salary - Your share of dividends - Occasionally lenders can consider net profit if there has been a large business expense or a sum earned but left in the business and not withdrawn.
Most lenders require self-employed borrowers to evidence three years’ worth of accounts for a mortgage, but some will accept two, and a minority even less than that. Find out more about mortgages for the self-employed here.
£150,0000 secured loans
Secured loans - also known as second charge mortgages or homeowner loans - are a viable option for property owners who need to raise capital, but cannot or do not wish to remortgage, for whatever reason.
It is certainly possible to get a homeowner loan of £150,000 - secured against your property as a second charge - subject to meeting the lender’s eligibility requirements, and factors such as non-standard income and adverse credit are usually less restrictive, while LTV requirements are flexible.
Rates for secured loans can be as competitive as mainstream mortgages, they’re also usually quicker to arrange and most have no early settlement fees.
For more information about homeowner loans, visit our dedicated page for them.
Where can I find a £150,000 mortgage calculator?
Because there are so many variables when it comes to getting a mortgage, such as credit history, deposit, income etc., online calculators can only give you a general indication of what is available. Your best option is to get expert advice from one of the brokers we work with.
Speak to a whole-of-market £150,000 mortgages expert
If you’re still wondering ‘can I afford a £150k mortgage? or would like to know more, call Online Mortgage Advisor today on 0800 304 7880 or make an enquiry here.
Then sit back and let us do all the hard work in finding the broker with the right expertise for your circumstances. - We don’t charge a fee and there’s absolutely no obligation or marks on your credit rating.
*Based on our research, the content contained in this article is accurate as of 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 info 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.
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 here...
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