Calculation methodology
The formulas, assumptions and sources behind every calculator on this site.
Last reviewed 21 August 2026
Core formulas
Monthly repayments use the standard annuity formula, where P is the loan, r the monthly interest rate and n the number of monthly payments:
M = P · r ÷ (1 − (1 + r)^−n)
Property transaction tax is calculated marginally: each band applies only to the slice of the price within it. Loan-to-value is the mortgage divided by the property value. Amortisation and overpayment results are produced by month-by-month simulation rather than a closed-form approximation.
Interest rates we use
Calculator defaults are set from observed UK market averages rather than invented figures. These are averages across lenders, not quotes, and no rate here is available to everyone — the rate you are offered depends on your deposit, credit profile and lender.
| Rate | Whole of market | Six largest lenders |
|---|---|---|
| Bank of England Bank Rate | 3.75% | — |
| Two-year fixed (75% LTV) | 5.29% | 4.77% |
| Five-year fixed (75% LTV) | 5.31% | 4.8% |
| Two-year variable (75% LTV) | 4.26% | — |
| Standard variable (revert) rate | 7.34% | — |
The 5% default sits between the big-six and whole-of-market average five-year fix at 75% LTV. The 7.5% stress rate is anchored on the average standard variable rate of 7.34%, which is where a deal reverts if you do not remortgage. Rates above are reviewed on the date shown and can move between reviews — always check current rates before deciding.
Lending assumptions
- Income multiples of 4× to 4.75× (typical 4.5×), applied to income after regular credit commitments.
- A secondary cap so total housing and debt costs stay within 45% of gross income.
- Default illustrative rate 5% over 25 years, stress-tested at 7.5%.
- Last reviewed 1 September 2026.
Sources:
- FCA — Mortgage affordability and responsible lending rules (MCOB 11)
- Bank of England — Financial Stability Report (LTI flow limit)
- Bank of England — Bank Rate
- Uswitch / Mojo Mortgages — average UK mortgage rates
- Moneyfacts — UK mortgage rate averages
Property tax data by jurisdiction
- England — Stamp Duty Land Tax (SDLT). Effective from 1 April 2025, last reviewed 21 August 2026. GOV.UK — Stamp Duty Land Tax rates
- Northern Ireland — Stamp Duty Land Tax (SDLT). Effective from 1 April 2025, last reviewed 21 August 2026. GOV.UK — Stamp Duty Land Tax rates
- Wales — Land Transaction Tax (LTT). Effective from 11 December 2024, last reviewed 21 August 2026. Welsh Revenue Authority — Land Transaction Tax rates
- Scotland — Land and Buildings Transaction Tax (LBTT). Effective from 5 December 2024, last reviewed 21 August 2026. Revenue Scotland — LBTT residential rates
Buying cost defaults
Indicative UK-wide typical ranges gathered from published consumer guidance. These are budgeting assumptions, not quotations — always obtain your own quotes. Last reviewed 21 August 2026. Every default can be replaced with your own quote inside the calculator.
Testing and correction
The calculation engine is covered by an automated test suite spanning each jurisdiction, first-time buyer relief, band boundaries, zero and negative inputs and unrealistic values. If you spot an error, please tell us — we check it against the source and update the review date when we correct it.
Per-calculator methodology
Each calculator restates its own formula, assumptions and limitations on its page:
- Mortgage Affordability & Buying Budget Calculator
- How Much House Can I Afford?
- Mortgage Deposit Calculator
- Mortgage Repayment Calculator
- First-Time Buyer Costs Calculator
- Stamp Duty Calculator (SDLT, LTT & LBTT)
- Estate Agent Fees & Solicitor Costs Calculator
- Loan-to-Value (LTV) Calculator
- Mortgage Overpayment Calculator
- Remortgage Calculator