How much house can you afford? - United Kingdom
Buying in United Kingdom? Taxes, insurance, and fees can change your true monthly cost.
Unlike simple calculators, this tool provides a complete financial picture. It doesn't just calculate principal and interest; it factors in critical costs that determine your actual monthly payment:
Use the interactive charts to visualize how your equity grows over time versus the interest paid to the bank. Perfect for comparing 15-year vs. 30-year loan terms.
Local tax rules and insurance costs vary—check official sources and lenders for current figures.
Use these estimates as a starting point and confirm details with local professionals.
First-time homebuyers estimating monthly costs
Refinancing to get a lower interest rate
Comparing 15-year vs 30-year mortgages
Commonly known as: home loan calculator, house payment calculator, mortgage payment estimator, home affordability calculator.
SDLT is a tax on property purchases in England and Northern Ireland. First-time buyers pay nothing up to £425k, 5% from £425k-£625k. For other buyers, rates start at 3% for the portion £250k-£925k, increasing for higher values.
A LISA lets you save up to £4,000/year with a 25% government bonus (up to £1,000/year). Can be used for a first home up to £450,000 or retirement. Must be under 40 to open.
Enter your loan details into our free Home Affordability calculator to see your estimated payments and savings.
A general rule is that your monthly mortgage payment should not exceed 28% of your gross monthly income (the 28/36 rule). For example, if you earn $6,000/month, aim to keep your payment under $1,680. Our calculator helps you test different scenarios.
Your monthly payment typically includes PITI: Principal (loan balance), Interest (cost of borrowing), Taxes (property taxes), and Insurance (homeowners). Some payments also include HOA fees and PMI if your down payment is under 20%.
A larger down payment reduces your loan amount, which lowers your monthly payment and total interest cost. Put down 20% to avoid PMI (Private Mortgage Insurance), which typically costs 0.5-1% of your loan annually.
Conventional loans typically require 620+, FHA loans accept 580+ (or 500 with 10% down), VA loans have no minimum but lenders prefer 620+. A score of 740+ gets you the best interest rates, potentially saving tens of thousands over the loan term.
The interest rate is the cost of borrowing the principal. APR (Annual Percentage Rate) includes the interest rate PLUS fees like origination costs, points, and mortgage insurance—giving you the true cost of the loan. Always compare APRs, not just rates.