Mortgage Deposit Calculator: LTV and Repayments
Calculates the loan amount, LTV and monthly repayment for a mortgage with a deposit, using an index rate plus the lender's margin.
With a deposit of 20% of the property price, you borrow the other 80%, so the loan-to-value (LTV) ratio is 80%. A smaller deposit pushes the LTV up and a larger one brings it down, and the LTV influences which rates lenders offer and therefore the monthly repayment. This calculator starts from the property price and the deposit to show the loan amount, the LTV and the monthly repayment, using the constant-payment (annuity) method on which UK capital and interest repayment mortgages are built.
Take the same property with a 10% deposit: the LTV is 90%. Raise the deposit to 25% and the LTV falls to 75%. For the same rate and term, the smaller loan lowers the monthly repayment in the same proportion, and a lower LTV may also qualify for a better rate. Trying these scenarios before you speak to a lender shows how much a few extra percentage points of deposit are worth.
The deposit is the money you pay from your own savings, gifts or other funds that do not come from the mortgage. The loan amount is the price minus the deposit. The monthly repayment then depends on that loan amount, the term in years and the annual interest rate. In the calculator, that rate is the sum of an index rate, such as the Bank Rate or SONIA, and the lender's margin, which is called the spread. This structure describes tracker and other variable-rate mortgages most directly, so treat the result as an estimate at the rate you enter, not a guarantee for the whole term.
The deposit is not the only cash a buyer needs. Stamp Duty Land Tax, Land and Buildings Transaction Tax in Scotland or Land Transaction Tax in Wales are payable on many purchases, and legal fees, the Land Registry fee, valuation and any lender arrangement fee also have to be paid from savings. These costs sit outside the LTV, so planning for them early avoids a shortfall at completion.
The result is a clear starting point, not a mortgage offer. Lenders assess income, credit history and the property valuation, and the contract sets out the exact terms. Use the figures to compare scenarios, then confirm them with a regulated adviser or the lender.
The explanation below uses metric units; the calculator works in either system.
The result updates automatically.
Total purchase price of the property
The amount paid without borrowing
Total length of the loan, in years
The reference rate the loan is linked to
The margin the lender adds on top of the reference rate
Estimated monthly repayment
Calculated using the standard repayment method, with equal monthly instalments
- Amount to borrow
- £180,000
- LTV (loan-to-value ratio)
- 90.0 %
- Nominal interest rate (NIR)
- 4.40 %
- Total interest paid
- £144,493
- Total amount payable
- £324,493
How it works
Formula
How the calculation works
Mortgage deposit calculator: loan amount, LTV and repayments
A mortgage application starts with the property price, but the amount a lender will actually lend depends on the deposit: the cash the buyer puts in from their own resources without borrowing. This calculator takes the property price and the deposit and works out three figures that matter in any UK mortgage discussion: the loan amount, the loan-to-value (LTV) ratio and the estimated monthly repayment. It also shows the total interest and the total amount repayable over the term, so the cost of the loan is visible as well as the monthly commitment.
The loan amount and the LTV
The loan amount is the property price minus the deposit. The lender does not finance the full price, only the part the buyer cannot cover from their own funds. The calculator treats this loan amount as the capital to be repaid with interest, and it requires the deposit to be below the price, because with a deposit equal to or above the price there is nothing to borrow.
The LTV expresses that loan amount as a percentage of the property price. A buyer who borrows 80% of the price has an LTV of 80%. It is a standard measure in UK lending: lenders group their products into LTV bands, and a lower LTV generally gives access to a wider choice of products and, in many cases, lower rates. Lenders normally base the LTV on the lower of the purchase price and the valuation carried out for the loan, so a valuation below the agreed price raises the LTV even when the deposit does not change.
The Bank of England's Financial Policy Committee sets the wider framework for mortgage lending, including affordability tests and limits on high loan-to-income lending. It does not set one LTV cap for all borrowers, so the maximum that applies to a particular buyer depends on the lender and the product. Checking the LTV before negotiating shows where an offer sits within the lender's range.
How the deposit changes the monthly repayment
The monthly repayment is calculated with the annuity method, which keeps the payment constant for every month of the term. Each payment covers the interest accrued in that month and reduces the balance by the remainder. In the early years most of the payment is interest, and the capital share grows over time. Three inputs determine the payment: the loan amount, the monthly interest rate and the number of monthly payments.
The deposit acts on the first of these. A larger deposit reduces the loan amount, and for the same rate and term the repayment falls in the same proportion. Moving the deposit from 10% to 25% of the price cuts the loan from 90% to 75% of the price, a reduction of about one sixth in the amount borrowed, and the monthly repayment falls by the same share. The effect in practice can be larger, because a lower LTV may secure a lower margin. That second effect depends on the lender and is not part of the arithmetic here.
The formula divides the annual nominal rate by 1200 rather than 12 because the rate is given as a percentage, so dividing by 100 converts it to a decimal and dividing by 12 converts it to a monthly rate. The number of payments is the term in years multiplied by 12. These are the conventions used in standard repayment schedules, so the result can be checked against the amortisation table a lender provides.
Index rate and margin in a UK mortgage
The interest rate in the calculator is the sum of two parts. The index rate is the reference rate written into the loan contract. In the UK this is typically the Bank Rate, which the Bank of England sets, or the Sterling Overnight Index Average (SONIA). The spread, also called the margin, is the amount the lender adds on top of the index. The sum is the nominal annual rate, called NAR in the formula.
Because most UK mortgages are fixed for an initial period, this structure describes tracker and other variable products more directly. For a fixed-rate loan, enter the fixed rate as the index rate and zero as the margin, and the calculator gives the repayment for that fixed period. When the fixed period ends, the repayment depends on the rate available at that time, so the figure for the later period should be modelled separately with the rate then expected.
When the term is shorter than the fixed period, the calculator's full-term result describes the repayment in that period only. This is worth keeping in mind when comparing a five-year fixed product with a longer tracker.
Deposit and the costs of buying
The deposit is only one part of the cash a buyer needs. In England and Northern Ireland, Stamp Duty Land Tax (SDLT) is payable on purchases above certain thresholds, and reliefs can apply to some buyers, including first-time buyers. Scotland applies Land and Buildings Transaction Tax (LBTT) and Wales applies Land Transaction Tax (LTT). Rates and thresholds are reviewed by the relevant governments, so current figures should be checked on GOV.UK, the official government website, or with a solicitor, not taken from older guides.
Other costs include conveyancing, the legal work for the transfer of ownership usually carried out by a solicitor or licensed conveyancer, the Land Registry fee for registering the new owner, a survey or valuation, and any arrangement or product fee charged by the lender. A buyer who saves only for the deposit and forgets these items often finds the cash position tighter than expected. The calculator does not include them in the LTV, because they are paid from savings on top of the deposit.
Overpayments: simulating with the calculator
Most UK mortgages allow overpayments, usually within an annual allowance set by the lender. Some products charge early repayment charges during the initial fixed or discount period. The terms are set out in the mortgage offer and contract, so they should be checked before any lump sum is paid.
To model a lump-sum overpayment, enter the outstanding balance after the overpayment as the property price, enter zero as the deposit and enter the remaining term. The monthly repayment shown is the estimate for the new balance. To compare reducing the payment with reducing the term, run the calculator again with a shorter remaining term and check the resulting repayment against the budget. The calculator does not model the lender's specific rules, so the result is an approximation.
Monthly repayment and the APR
The monthly repayment is the most immediate figure, but it does not show the full cost of a loan. For comparing offers, the figure to use is the annual percentage rate (APR), or the annual percentage rate of charge (APRC) shown in mortgage illustrations, which includes interest and most mandatory charges. Lenders set out these figures in the Key Facts Illustration (KFI) they provide during the application.
The total interest shown by the calculator is an estimate based on the rate you enter. It excludes fees and other charges that the APRC takes into account, so use it to understand how the deposit and term change the cost, not to compare lenders directly.
Edge cases and common mistakes
Three cases need attention. If the deposit equals or exceeds the property price, there is no loan to calculate, so the calculator shows no result. The term must be greater than zero, because a loan with no payments has no monthly repayment. A nominal rate of zero means no interest: the calculator then divides the loan evenly across the payments, which is the limit of the formula at that rate.
Common mistakes include using the asking price rather than the agreed price, forgetting the costs listed above, treating a variable rate as fixed for the whole term, and forgetting that a valuation below the price raises the LTV and may change the rate offered.
When to use this calculator and when not to
Use the calculator early in the search, when the deposit is still being set and the buyer wants to see how the LTV and repayment respond to a change in deposit, price or term. It is also suited to checking the effect of an overpayment. Do not treat it as a substitute for a lender's offer, which takes account of credit history, income, employment, the property valuation and the specific terms of the product.
When to speak to a professional
Mortgage advice is a regulated activity in the UK, so brokers and advisers must be authorised by the Financial Conduct Authority (FCA). A mortgage broker can compare products from many lenders, explain the terms and handle the application. The FCA publishes the Financial Services Register, which can be searched to check any firm before you engage it. For more complex cases, such as self-employed income, a past credit problem or a non-standard property, professional advice often pays for itself, because the choice of lender depends heavily on those details.
Frequently asked questions
What is LTV in a UK mortgage?
LTV, or loan-to-value, is the mortgage amount expressed as a percentage of the property value. If you borrow 80% of the price, your LTV is 80%. Lenders use it to group products into bands, and a lower LTV usually gives access to a wider range of rates. Lenders normally base the LTV on the lower of the purchase price and the valuation carried out for the loan. The Bank of England does not set one LTV limit for all borrowers, so the maximum that applies to you depends on the lender and the product. Ask your lender or broker for the LTV bands on the products you are considering.
How much deposit do I need for a mortgage in the UK?
There is no fixed legal minimum deposit. Each lender sets its own criteria, and these usually depend on the LTV it will accept for your circumstances. The deposit is only part of the cash needed, because you may also have to pay Stamp Duty Land Tax in England and Northern Ireland, Land and Buildings Transaction Tax in Scotland or Land Transaction Tax in Wales, where they apply, plus legal fees, the Land Registry fee, and valuation and arrangement fees. Enter your price and deposit above to see the LTV, then check current tax thresholds on GOV.UK before setting your budget.
What is the difference between this calculator and a repayment calculator?
A repayment calculator starts from the amount you want to borrow. This calculator starts from the property price and the deposit, works out the loan amount and the LTV, and then calculates the monthly repayment. It is useful while you are still deciding how much deposit to put down, because you can see how each change affects the LTV and the monthly payment before you speak to a lender.
Does a bigger deposit always reduce the monthly repayment?
For the same rate and term, yes. A larger deposit reduces the loan amount, and the repayment falls in proportion. A lower LTV can also make lenders more willing to offer a lower margin, which lowers the rate and reduces the repayment further. That second effect depends on the lender and product, so the calculator shows only the arithmetic. Use it to compare deposits at the same rate, then check the rates on offer at each LTV band.
Can I use this calculator to model an overpayment?
Yes. Enter the outstanding balance after the overpayment as the property price, enter zero as the deposit and enter the remaining term. The result is the estimated new monthly repayment. Overpayment allowances and early repayment charges depend on your mortgage contract, so check them before paying. The calculator gives an approximation and does not model your lender's rules for reducing the payment or the term.
When should I speak to a mortgage broker?
A mortgage broker authorised by the Financial Conduct Authority is useful when you want to compare products from several lenders without contacting each one, when your credit history has irregularities, or when your income is unusual, for example if you are self-employed. You can check any firm's status on the FCA's Financial Services Register before you engage it. Ask how the broker is paid, including any fee, before you agree to go ahead.
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By RivoCalc · Reviewed under our editorial methodology · Updated 6 July 2026
This calculator gives an estimate for information only and is not financial advice. Actual repayments depend on the lender's terms, the rate you are offered, the property valuation and your personal circumstances. Speak to an FCA-authorised mortgage adviser or to your lender before making any financial decision.