Estimates a monthly mortgage payment from the property price, deposit, interest rate and term, adding annual tax and insurance to give an all-in figure.
The amount borrowed is the price less the deposit, and the capital-and-interest payment is calculated by the standard amortisation formula. Annual tax and insurance figures are divided by twelve and added, which is what makes the headline number an all-in monthly cost rather than just the loan payment — the difference between the two is routinely large enough to change what is affordable. The deposit is also shown as a share of the price, because that percentage determines which products are available to you and at what rate far more than the deposit's absolute size does.
What a mortgage really costs
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The deposit percentage sets the rate you are offered:
lenders price in bands, and crossing a threshold — ten per cent, twenty per cent — can matter more than the extra deposit itself.
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Tax and insurance are not optional:
property tax and buildings insurance continue for as long as you own the property, and they rise over time in ways the loan payment does not.
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Closing costs are not here:
legal fees, survey, stamp duty or transfer tax and lender fees are paid up front and can amount to several per cent of the price.
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A fixed rate for the whole term is assumed:
most mortgages fix for an initial period and then revert. Model the reversion rate separately before committing.
Why this is an all-in figure, not just the loan payment
The amount borrowed is the property price less the deposit, and the [msm_tool slug="mortgage-calculator"] calculates the capital-and-interest payment on that with the standard amortisation formula — then adds annual property tax and insurance, divided by twelve, to reach a genuinely all-in monthly cost rather than the loan payment alone. That gap between the two figures is routinely large enough on its own to change what actually looks affordable.
The deposit percentage matters more than its size
Lenders price mortgages in bands, so the deposit shown as a share of the property's price determines which products are available and at what rate, often more than the absolute amount of the deposit does on its own. Crossing a threshold — ten per cent, twenty per cent — can matter more to the rate offered than adding the same sum anywhere else in the calculation.
Tax and insurance are not optional, and they do not stay still
Property tax and buildings insurance continue for as long as the property is owned, entirely independent of the mortgage itself, and both tend to rise over time in a way the loan payment does not. Treating them as a rounding error on top of the "real" payment understates a cost that grows every year the loan payment does not.
Closing costs live entirely outside this number
Legal fees, a survey, stamp duty or transfer tax, and lender fees are all paid up front at completion rather than spread across the mortgage term, and together they can add several per cent to the property's price. None of that appears in the monthly figure here, since it is a one-time cost at purchase rather than an ongoing one.
A fixed rate for the whole term is assumed
Most mortgages fix for an initial period and then revert to a different rate, and this calculation holds one rate constant across the entire term rather than modelling that later change. The reversion rate is worth working through as a separate scenario before committing to anything based on the fixed-period figure alone.