If you know that you qualify for a £250,000mortgage or are ready to apply for one, it’s important to get an idea of what your repayments could look like. In this comperehensive guide, you’ll learn how to calculate them, what variables will affect them, and what to do after you’ve crunched thosenumbers.
How much are the repayments on a £250,000 mortgage?
The average cost of a £250k mortgage right now is £1,461 per month which means you would pay back around £438,443 across the whole term. This is based on average interest rates at the time of writing (May 2024) being 5% and typical term lengths being 25 years.
Keep in mind that the amount you will pay can vary considerably based on the rate you qualify for, the term length you choose and the type of mortgage you opt for.
How to work out your mortgage repayments
Use our mortgage calculator below to work out how much your repayments will be if you were to borrow £250,000. You can use this tool to compare different rates and terms, and there’s an option to convert the results to interest-only.
Now that you have run some calculations, your next step should be to choose your own mortgage deal through Teito. You can compare rates from across the market through our service and we have expert brokers on hand to provide assistance.
Factors that will determine your mortgage payments
The exact repayments on a mortgage of £250,000 can vary depending on several factors, mainly the term length, interest rate and mortgage type. The tables below contain example calculations to illustrate how these factors can impact the amount you will pay.
Term length
The table below shows how the payments on a £250k capital repayment mortgage can vary based on the term length. These calculations used a 5% interest rate for example purposes.
Mortgage Amount | Term Length | Monthly Repayments | Overall Repayment |
| £250 | 10 | £2,652 | £318,197 |
£250k | 15 years | £1,977 | £355,857 |
£250k | 20 years | £1,650 | £395,973 |
£250k | 25 years | £1,461 | £438,443 |
£250k | 30 years | £1,342 | £483,139 |
£250k | 35 years | £1,262 | £529,922 |
£250k | 40 years | £1,205 | £578,636 |
If you choose a longer term length, you would be spreading your mortgage repayments out, which means they will be lower, but you will pay more in interest overall. Shorter-term mortgages are more expensive each month, but allow you to make longer-term savings due to there being fewer interest instalments, and pay off the debt to own your home outright quicker.
Interest rate
The interest rate you end up with will have a major bearing on how much your £250k mortgage costs each month. The table below puts this into perspective, using a standard term length of 25 years for example purposes and basing the calculations on a capital repayment agreement.
Mortgage Amount | Interest Rate | Monthly Repayments | Overall Repayment |
£250k | 3.5% | £1,252 | £375,468 |
£250k | 4% | £1,320 | £395,878 |
£250k | 4.5% | £1,390 | £416,874 |
£250k | 5% | £1,461 | £438,443 |
£250k | 5.5% | £1,535 | £460,566 |
£250k | 6% | £1,611 | £483,226 |
Mortgage type
The type of mortgage you take out will determine how you make your repayments and how interest is charged. The two main repayment types are capital repayment and interest-only.
Most residential mortgages are taken out on a capital repayment basis, which means you repay the debt plus interest each month over the agreed term. Interest-only mortgages are the main alternatives to this, and they involve only making interest payments each month, and clearing the mortgage debt at the end of the term, via a pre-approved repayment vehicle.
The table below shows what the repayments on a £250k interest-only mortgage look like. A standard term length of 25 years has been used for example purposes.
Mortgage Amount | Interest Rate | Interest-only Payments (Monthly) | Overall Repayment |
£250k | 3.5% | £729 | £468,750 |
£250k | 4% | £833 | £500,000 |
£250k | 4.5% | £938 | £531,250 |
£250k | 5% | £1,042 | £562,500 |
£250k | 5.5% | £1,146 | £593,750 |
£250k | 6% | £1,250 | £625,000 |
In addition to the repayment type, your product type will also determine how interest is charged each month. If you were to select a fixed-rate mortgage, there will be an introductory rates period where the interest charges will be consistently the same each month. After this, the mortgage will revert to the lender’s standard variable rate (SVR), which will be higher.
The main alternative to this is a type of variable rate mortgage called a tracker mortgage. With these agreements, the rate can move up and down in line with an external marker, usually the Bank of England’s base rate, so your repayments may vary from one period to the next.
Read more about fixed-rate and tracker mortgages in our standalone guides.
Comparing different mortgage amounts
For some borrowers, £250,000 will be a ballpark mortgage amount, so we have put together the table below to show example repayments for loans of slightly more and less than this.
The examples below are for a capital repayment mortgage with a 5% rate and 25-year term.
Mortgage Amount | Monthly Repayments | Overall Repayments |
£225k | £1,315 | £394,598 |
£235k | £1,374 | £412,136 |
£245k | £1,432 | £429,674 |
£255k | £1,491 | £447,211 |
£265k | £1,549 | £464,749 |
£275k | £1,608 | £482,287 |
Calculations all done? Here are your options now...
Tips to help you lower your repayments
The key to securing lower repayments on a £250,000 mortgage is landing the best deal available with the right terms for your needs and circ*mstances. The tips we have compiled below can help you land a lower interest rate and save money on your mortgage.
- Save extra deposit: Not everyone is in a position to do this, but if you can put down extra deposit (at least more than 5-10%) it can help you secure a lower interest rate.
- Optimise your credit reports: You can download your credit reports by accessing a free trial with Checkmyfile. Going through them to flag up inaccuracies and outdated information can improve your creditworthiness and help you land a lower rate.
- Know your options: Thinking carefully about the term length and mortgage type is important. A longer term means lower monthly repayments, but you may have to pay more in interest overall. Similarly, taking out an interest-only mortgage can mean lower payments, but you will need a method of settling the mortgage at the end of the term.
- Speak to a mortgage broker: A whole-of-market mortgage broker can help you lower your mortgage repayments by ensuring you get the best deal available with the terms and product type that best suits your needs and circ*mstances.
Why choose Teito for your £250,000 mortgage?
After you have run some initial calculations, your next step should be to access our free comparison service to choose your own mortgage deal. You can source deals from across the market with us and we have whole-of-market brokers on hand to help.
Our brokers will ensure the £250,000 mortgage deal you have chosen is the best and most suitable one available for you. Here are some of the other reasons to choose Teito:
- Exclusive rates and deals are available
- Our brokers could help you save time and money
- You can secure a mortgage in principle in minutes
- We are 5-star rated on leading review websites
After you have sourced your mortgage with us, our brokers will offer you a free, no-obligation chat to make sure you’ve got the best deal - get started with us here.
FAQs
All of the mortgage applicants will need a combined annual income of around £55,000 to qualify for a £250,000 mortgage. This is based on the fact that the majority of UK mortgage providers will cap their maximum lending based on 4.5 times salary, but some will stretch to 5-6 times income, so you may have options if you earn less than this ballpark figure.
The amount of deposit you need will not be dependent on the mortgage size, but the purchase price of the property you are buying. The minimum is usually 5-10% of the property’s value, but putting down more can reduce your repayments by lowering the interest rate.
Choosing an Adviser
Selecting a qualified and experienced mortgage adviser is of great importance. To choose a suitable adviser, evaluate their qualifications, experience, and reputation, and ensure they are regulated by the Financial Conduct Authority (FCA).
Read reviews from previous clients and make sure they provide a clear explanation of the products and services they offer, as well as the fees and charges associated with them.
