Amortisation Calculator 2025

Mortgage amortisation in the UK works by spreading your loan repayment over the agreed term through regular payments. Each payment covers both interest on the outstanding balance and a portion of the principal. Early in the mortgage, most of your payment goes toward interest, but as time progresses, more goes toward reducing the principal balance.

With a repayment mortgage (shown in this calculator), you pay both interest and principal each month, gradually reducing your debt. With an interest-only mortgage, you only pay interest monthly, meaning the principal balance remains unchanged and must be repaid in full at the end of the term through a separate repayment vehicle.

Extra payments go directly toward reducing your principal balance, which accelerates your amortisation schedule. This reduces the total interest paid over the life of the loan and shortens the repayment term. Even small extra payments can result in significant savings over time, but check for any early repayment charges first.

An amortisation schedule provides a comprehensive breakdown of every payment throughout your mortgage term. For each payment, you'll see: Payment number and date - Sequential numbering from payment 1 to final payment, with exact dates. Payment amount - Your regular payment (e.g., £1,754 monthly on a £300,000 loan at 5.5%). Principal portion - Amount reducing your loan balance (starts low, increases over time). Interest portion - Amount paid to the lender (starts high, decreases over time). Remaining balance - Outstanding loan amount after each payment. Cumulative interest - Total interest paid to date.

For example, on a £300,000 mortgage at 5.5% over 25 years: Payment 1 might be £1,375 interest + £379 principal. Payment 150 (year 12.5) might be £1,000 interest + £754 principal. Final payment might be £8 interest + £1,746 principal. This visualization helps you understand how your mortgage evolves, plan for overpayments, and see the impact of rate changes. Use our calculator above to generate your personalized schedule.

There are several effective strategies to reduce total interest on your UK mortgage:

1. Make overpayments - Even £100/month extra on a £300,000 mortgage at 5.5% saves approximately £32,000 in interest and reduces the term by 3-4 years. Check your lender's overpayment limits (typically 10% annually without penalties).

2. Increase payment frequency - Switching from monthly to fortnightly payments (paying half your monthly amount every 2 weeks) results in 13 full monthly payments per year instead of 12, accelerating repayment.

3. Make lump sum payments - Use bonuses, inheritance, or savings to make large one-off payments. These go directly to principal, significantly reducing future interest.

4. Remortgage to lower rates - When your fixed term ends, remortgaging to a lower rate can save thousands. Even 0.5% reduction on £300,000 saves approximately £1,500/year.

5. Reduce the term - If affordable, choosing a 20-year term instead of 25 years increases monthly payments but dramatically reduces total interest. Use our overpayment calculator to see exact savings from extra payments.

Payment frequency affects both your cash flow and total interest paid:

Monthly payments - Standard UK option. One payment per month = 12 payments/year. Example: £300,000 at 5.5% over 25 years = £1,754/month.

Fortnightly payments - Payment every 2 weeks = 26 payments/year (equivalent to 13 monthly payments). You pay half your monthly amount (£877) every fortnight. This accelerates repayment because you make an extra month's payment annually. Saves approximately £15,000-£20,000 in interest over 25 years and reduces term by 2-3 years.

Weekly payments - Payment every week = 52 payments/year. You pay one-quarter of your monthly amount (£438.50) weekly. Similar benefits to fortnightly but with more frequent, smaller payments that may suit weekly-paid workers.

Key consideration: Not all UK lenders offer fortnightly or weekly options. Most require monthly Direct Debit. However, you can achieve similar benefits by making monthly overpayments equivalent to one extra month's payment per year. Our calculator shows all three frequencies - select your preferred option to see the exact schedule and savings.

Your amortisation schedule is highly sensitive to interest rate changes, especially if you have a variable rate or tracker mortgage:

Fixed-rate mortgages - Your schedule remains unchanged during the fixed period (typically 2-5 years). After the fixed term ends, you'll move to your lender's Standard Variable Rate (SVR), which can be 2-3% higher. This dramatically changes your schedule: £300,000 at 5.5% fixed = £1,754/month. Same loan at 7.5% SVR = £2,188/month (+£434/month or +£5,208/year).

Variable-rate mortgages - Your schedule changes whenever the Bank of England base rate changes. If rates increase by 0.25%, your monthly payment increases immediately. If rates decrease, your payment reduces.

Impact on amortisation - Higher rates mean more of each payment goes to interest and less to principal, extending your effective repayment timeline. Lower rates accelerate principal reduction.

Example: £300,000 over 25 years: At 4.5%: £1,667/month, £200,000 total interest. At 5.5%: £1,754/month, £226,000 total interest (+£26,000). At 6.5%: £2,043/month, £313,000 total interest (+£113,000 vs 4.5%).

Protection strategy: Use our stress test calculator to see how rate increases affect your affordability. Consider fixing when rates are favorable to lock in your amortisation schedule.

Yes, our amortisation calculator works for buy-to-let (BTL) mortgages, but there are important differences to consider:

Interest-only vs repayment - Most BTL mortgages are interest-only, meaning you only pay interest monthly and the principal remains unchanged. Our calculator shows repayment mortgages where you pay both principal and interest. For interest-only BTL, your "amortisation schedule" is simpler: same interest payment every month, no principal reduction.

Higher interest rates - BTL mortgages typically have rates 1-2% higher than residential mortgages. Example: Residential at 5.5%, BTL at 6.5-7.5%.

Rental income consideration - BTL lenders assess affordability based on rental income (typically requiring rent to be 125-145% of mortgage payment). Our calculator doesn't factor in rental income, but you can compare monthly payment against expected rent.

Tax implications - BTL landlords can no longer deduct full mortgage interest from rental income for tax purposes. Instead, you receive a 20% tax credit. For BTL-specific calculations including rental yield and tax, consider using a dedicated BTL calculator. For repayment BTL mortgages, our calculator provides accurate amortisation schedules.