This tool shows how much a new mortgage deal will impact your monthly payments.
How to use this calculator
Enter the amount you have left to pay on your mortgage, the number of years you have left in which to pay it, your annual pre-tax income (you can enter your household income if more than one person contributes to the mortgage) and the interest rate on your current mortgage deal.
Then, using the slider, select the interest rate for your new mortgage deal.
The results will show you your current and future mortgage payments, the difference between and two, and the proportion of your take-home pay that will be taken up by these mortgage payments.
How it works
The calculator uses the information you provide about your remaining loan, mortgage term and interest rate to work out your monthly payments.
The difference between your old and new mortgage deal is picked out so you can see how much your bills will increase, and each figure is set against your monthly income to show how much is being taken up by mortgage bills alone.
What is this calculator useful for?
This is useful for anyone who needs to remortgage and wants to know how their monthly bills will change. If your bills are set to change dramatically, you can at least start planning ahead of time.
If you’re trying to choose between more than one deal, you can easily change the information to see how your monthly payments would differ, and whether you could free up more of your take home pay.
What’s happening to mortgage rates?
Mortgage rates have been on the decline for the past few weeks, with several major lenders reducing top deals to less than 4pc.
One helping factor is that interest rates have fallen, as the Bank of England chose to cut the Bank Rate to 5pc following its most recent Monetary Policy Committee meeting. It’s anticipated there will be at least one more rate reduction by the end of the year. The next rates decision will be announced on September 19.
The likelihood of future Bank Rate cuts depends on a lot of factors – the Bank not only considers issues affecting the British economy, such as wage growth and inflation, but also what international central banks are doing to curb their own inflationary woes.
The consumer prices index (CPI) measure of inflation measured 2.2pc in July, up slightly from 2pc in July. This rise may mean we are less likely to see another rate cut in September.
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