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22 September 2015

Mortgage Calculator Breakdown: How it Works

Find out how mortgage calculators work in this helpful guide, and get to grips with Principality's straightforward and quick-to-use mortgage calculator.

Mortgage calculators are a very handy way to work out an idea of budgets to get the deposit you need for your new home. This short guide explains how mortgage calculators work, how they determine what you can borrow, and why Principality Building Society’s mortgage calculator is straightforward and helpful.

Open up Principality’s mortgage calculator tool

What is a mortgage calculator?

A mortgage calculator is a useful tool to give you an idea of how much you might be able to borrow when buying a home. However it’s worth remembering that mortgage calculators aren’t mortgage offers, there will be lots of other information required by the lender before an offer is made.

Our mortgage calculator uses the applicants’ salary or income, your region, outgoings such as a student loan, and the duration you’d like your mortgage for to calculate how much we may lend you.

The affordability of the mortgage repayment is assessed by taking into account income (net of income tax and national insurance) as well as committed expenditure, basic essential expenditure and basic quality of living costs.  Our assessment takes into account the likely impact of future interest rate increases.  

At Principality, our mortgage calculator will also tell you how much it will cost each month to borrow the amount you need, and show you the range of mortgages that are potentially available to you.

How to calculate how much you can borrow

Our mortgage calculator works with two simple steps.

First, you can find out how much you can borrow by putting in the details of your income, (details of your outgoings can help to get a clearer picture) and the duration of your mortgage, from 5-40 years.

The next step is to find out how much it will cost to borrow the amount you want for the time you want it. By adjusting the options to see what difference your deposit can make to your monthly repayments. 

Principality’s mortgage calculator will also suggest different mortgage products for you to see what may suit you.

Browse our mortgages now

Principality's easy to use mortgage repayment calculator

We want everything to be as clear and straightforward as possible for our customers. Our mortgage calculator has a really clear layout, and is quick and easy to use. You can compare different amounts to borrow against the purchase price of the property, calculate your overall mortgage costs and compare products, without having to leave the page.

Continue your research with our guide to mortgage types

Mortgage Jargon Buster

Sometimes finding a mortgage can be confusing, but luckily we have a mortgage jargon buster to help. With terms like “loan to value” (LTV), vendor, agreement in principle and other phrases, visit our First Time Triers page where you’ll find a Mortgage Translator video, with lots of information to help you buy your first home and clear up what those technical terms mean.

Click here to read our practical guide to buying your first home

Next Steps – How to Arrange Your Mortgage 

After using the mortgage calculator, we hope you have a clearer idea of how much you may be able to borrow. Have a look at our range of mortgages, we arrange fixed rate and variable/tracker rate mortgages. It’s worth checking out our discount mortgages with special deals for a limited time, or perhaps our Buy to Let mortgages.

Click here to view our range of mortgage products

When you’re ready to take the next steps to securing your mortgage, talk to one of our mortgage advisers at your local branch, or by calling us on 0330 333 4000 (between 8am and 8pm weekdays, except Wednesdays 9.30am to 8pm, and 9am to 1pm on Saturdays).

Published: 22/09/2015