Think carefully before securing other debts against your home. Your home may be repossessed if you do not keep up repayments on a mortgage or any other debt secured on it.
Understanding mortgage types
There are two decisions to make: how the loan is repaid, and how the interest rate is set.
- Repayment mortgage — monthly payments cover both the loan amount and the interest. By the end of the term the mortgage is fully paid off. The most common choice for residential buyers.
- Interest-only mortgage — you pay only the interest each month, which keeps payments lower, but the full loan amount is still owed at the end of the term. You need a clear plan to repay it.
- Fixed-rate mortgage — your rate is locked for a set period, usually two or five years, giving certainty on monthly costs and protection from rate rises.
- Tracker mortgage — your rate follows the Bank of England base rate plus a set margin, so payments can go up or down. Often cheaper at first, but less predictable.
Mortgages for different situations
First-time buyers can usually find deals with a deposit from 5%, and government-backed schemes such as Shared Ownership may help. If you are remortgaging, it is worth reviewing your options before your current deal ends, because many mortgages move to the lender's standard variable rate afterwards.
If you are moving home you may be able to port your existing mortgage to the new property, borrow additional funds, or take a new deal altogether. Buying to let, or buying with adverse credit, involves different lending criteria — see our dedicated pages on buy to let and bad credit mortgages.
What affects how much you can borrow and the rate
Most lenders will offer a multiple of your annual household income, typically around four to four and a half times, with some lenders going higher for certain applicants. The final figure depends on an affordability assessment of your outgoings, existing debts and credit history.
Your loan to value (LTV) — the mortgage as a share of the property's value — is the other big lever. The more deposit you put down, the lower the LTV and, usually, the lower the rate.
Fees and costs to budget for
Beyond the interest, common costs include an arrangement or product fee (sometimes added to the loan), a valuation fee, conveyancing or solicitor fees, and stamp duty or its equivalent in Scotland and Wales. Some brokers also charge a fee. Adding a fee to the loan means you pay interest on it, so compare the total cost over the deal period, not just the headline rate.
Getting help
A regulated mortgage broker or independent financial advice firm can help you compare lenders and check whether a mortgage is suitable for you. MoneyHelper (moneyhelper.org.uk) offers free, impartial guidance on buying a home and choosing a mortgage.
Mortgage repayment calculator
That is a 15% deposit — 85% LTV.
Enter any rate to see an illustration. The rate a lender offers depends on your LTV, circumstances and its own criteria.
Borrowing £255,000 over 25 years at 4.5% on a repayment basis would cost around £1,417.37 a month. The figures in this calculator are for illustrative purposes only.
Illustrative only — not a quote, an offer of credit or financial advice. Calculated at a constant rate for the whole term. In practice an initial fixed or tracker rate usually reverts to the lender's standard variable rate, and product fees are not included here. Your home may be repossessed if you do not keep up repayments on your mortgage.
Mortgages guides
Common questions
How much deposit do I need for a mortgage?
How much deposit do I need for a mortgage?
Most lenders require a minimum 5% deposit, though you will usually get better rates with 10% to 25% or more. The more deposit you put down, the lower your interest rate will typically be.
Should I get a fixed or variable rate mortgage?
Should I get a fixed or variable rate mortgage?
A fixed rate gives you certainty — your monthly payment stays the same for the fixed period, usually two or five years. A variable or tracker rate can be cheaper initially, but your payments may go up or down with the Bank of England base rate.
How much can I borrow?
How much can I borrow?
Many lenders offer around four to four and a half times your annual household income, and some go higher for certain applicants. Your borrowing capacity also depends on your outgoings, existing debts and credit history.
What's the difference between a repayment and an interest-only mortgage?
What's the difference between a repayment and an interest-only mortgage?
With a repayment mortgage your monthly payments cover interest and capital, so the debt is cleared by the end of the term. With interest-only you pay just the interest, so payments are lower but the full loan is still owed at the end and you need a plan to repay it.
What happens when my fixed rate ends?
What happens when my fixed rate ends?
Most mortgages move onto the lender's standard variable rate, which is often higher. Many borrowers look at remortgaging or switching to a new deal with their current lender a few months before the fixed period ends.
How long does a mortgage application take?
How long does a mortgage application take?
A straightforward application typically takes a few weeks from application to offer. The full purchase process, including conveyancing and completion, usually takes a few months. Remortgages are often quicker.
Think carefully before securing other debts against your home. Your home may be repossessed if you do not keep up repayments on a mortgage or any other debt secured on it.
Important: This page is general information, not financial advice or a personal recommendation. Product features and eligibility vary by provider — check the provider's own terms before you buy or apply.