Mortgage affordability and rate sensitivity
Mortgage decisions come down to four levers: the rate, the deposit, the term and how much a lender will advance. This page quantifies each one, so you can see which actually moves the number.
The short answer
On a £270,000 repayment mortgage over 25 years, a 1 percentage point change in rate moves the monthly payment by about £153 — roughly £1,839 a year.
Stretching the term from 25 to 35 years cuts the monthly payment by £216 but adds £98,798 in total interest.
Raising a deposit from 5% to 10% on a £300,000 home cuts the monthly payment by £88 before any rate improvement from the lower LTV.
Rate sensitivity
£270,000 repayment mortgage, 25-year term. Rates are illustrative UKCalc modelling inputs, not offers or forecasts.
| Rate | Monthly | Total paid | vs 3.5% |
|---|---|---|---|
| 3.5% | £1,352 | £405,505 | — |
| 4.0% | £1,425 | £427,548 | +£73 |
| 4.5% | £1,501 | £450,224 | +£149 |
| 5.0% | £1,578 | £473,518 | +£227 |
| 5.5% | £1,658 | £497,411 | +£306 |
| 6.0% | £1,740 | £521,884 | +£388 |
| 6.5% | £1,823 | £546,918 | +£471 |
Deposit and LTV
A larger deposit reduces the loan and usually unlocks a lower rate tier. The tiers below are structural — where lender competition tends to concentrate — not a quote.
| Deposit | Cash | LTV | Monthly at 5.0% | Typical availability |
|---|---|---|---|---|
| 5% | £15,000 | 95% | £1,666 | Higher rates, fewer lenders |
| 10% | £30,000 | 90% | £1,578 | Most mainstream lenders compete |
| 15% | £45,000 | 85% | £1,491 | Access to most competitive fixed deals |
| 20% | £60,000 | 80% | £1,403 | Best rates available |
| 25% | £75,000 | 75% | £1,315 | Widest choice, lowest rates |
Term length
A longer term lowers the monthly payment and raises the total cost. Both matter.
| Term | Monthly at 5.0% | Total paid | Total interest |
|---|---|---|---|
| 20 years | £1,782 | £427,651 | £157,651 |
| 25 years | £1,578 | £473,518 | £203,518 |
| 30 years | £1,449 | £521,791 | £251,791 |
| 35 years | £1,363 | £572,316 | £302,316 |
| 40 years | £1,302 | £624,927 | £354,927 |
Income multiple
On a £55,000 income. Most lenders cap around 4.5×; some offer more to specific borrowers under their own criteria.
| Multiple | Maximum loan | Price at 10% deposit |
|---|---|---|
| 4.0× | £220,000 | £244,444 |
| 4.5× | £247,500 | £275,000 |
| 5.0× | £275,000 | £305,556 |
| 5.5× | £302,500 | £336,111 |
When a mortgage broker may be useful
A broker is not automatically worth using, and this page does not rank or recommend any firm. The question is whether your situation needs access to more lenders than you can reasonably approach yourself.
Fee models
Brokers are paid either by commission from the lender, by a fee from you, or both. Fee-charging brokers typically charge a few hundred pounds; fee-free brokers rely on lender commission. Neither model is inherently better — what matters is the size of the lender panel, whether the broker searches the whole market, and whether the fee is refundable.
Situations where broker access tends to matter
- Self-employed, contract or variable income, where lenders assess earnings very differently
- High loan-to-value, where fewer lenders compete and criteria are tighter
- New-build purchases, where some lenders restrict lending or cap LTV
- Adverse credit, where mainstream automated decisions often decline
- Unusual property construction or tenure
When going direct may be enough
A straightforward remortgage on a mainstream property with employed income and a comfortable LTV is well served by going direct — particularly to a lender you already bank with.
How much can I borrow? · Monthly repayment calculator · Will I pass the lender stress test? · Overpayment calculator · First-time buyer guide
This page shows how the numbers move. Those calculators give you your own figure.
What is fact, what is assumption, and what is UKCalc's analysis
- None. Mortgage rates, lender criteria and income multiples are set by lenders, not by statute.
- Stamp duty, where relevant to a purchase, is covered separately in the SDLT cliff analysis.
- Illustrative mortgage rates spanning a plausible range. These are UKCalc modelling inputs, not forecasts or offers.
- Legal, survey and lender fees excluded from monthly cost unless stated.
- Capital repayment mortgage on a constant rate for the whole term — real mortgages reprice at the end of a fixed period.
- LTV tiers describe where lender competition typically concentrates; they are not quotes.
- Income multiples are illustrative caps, not an offer.
- Every monthly payment, total cost and interest figure
- The per-1pp, per-term and per-deposit differences
- The borrowing capacity figures
These are arithmetic on UKCalc's stated assumptions. They are not offers, quotes or forecasts.
Sources
- Bank of England — Bank Rate
- FCA Handbook MCOB 11.6 — responsible lending and affordability
- FCA — information for consumers
Limitations
- Actual rates depend on the lender, product, LTV, credit profile and term, and change constantly.
- Lender affordability assessments use stress rates and your committed outgoings, not a simple income multiple. See the stress test.
- This page does not compare, rank or recommend lenders or brokers.
- Not financial advice. A regulated adviser can assess your circumstances.
Statutory figures last verified 2 September 2026 against the sources above, from UKCalc statutory registry 2.5.0. This is general information, not financial or tax advice.