Repayments on a £175,000 Mortgage

A mortgage of £175,000 is below the average size in the UK, but it still pays to do your homework before you apply for one. Here you will learn how to calculate the repayments for a mortgage of this amount, and how to get the best deal.

What is the monthly payment on a £175,000 mortgage?

The average monthly repayment on a £175,000 mortgage is roughly £924. This is based on a capital repayment mortgage with an interest rate of 4% and term length of 25 years, which is representative of the UK market at the time of writing.

Mortgage payments of this amount would mean that you would have repaid a total of £277,114 by the end of the term, assuming there are no changes to the agreement.

Your exact repayments on a mortgage of this amount will depend on the interest rate you qualify for, the term length you choose and the type of mortgage you take out.

Calculate your monthly repayments

You can work out the monthly repayments on your £175k mortgage by entering an interest rate and term length below and then hitting 'calculate'. This calculator can be used to compare different rates and term lengths and the results can be converted to interest only.

Now that you’ve run some calculations, you next step should be a free, no-obligation chat with a whole-of-market mortgage advisor - get started here.

Factors that will determine your mortgage repayments

The exact repayments on your £175k mortgage may vary from the example we have provided. The factors that could cause them to vary are the interest rate, term length and the type of mortgage you choose - we will explore these varies in depth in this section.

Interest rate

The interest rate you qualify for will largely depend on the loan-to-value (LTV) ratio and overall strength of your application. The table below shows how the cost of a £175k capital repayment mortgage, taken over 25 years, can vary across different interest rates.

Term length

Most mortgage lenders offer a range of different term lengths that you can take your mortgage over. A longer term means lower monthly repayment but having to pay more in the long run due to a great number of interest instalments. The table below shows the impact of term lengths on a £175k capital repayment mortgage with a 4% interest rate.

Repayment type

Most mortgages in the UK are taken out on a capital repayment basis but the majority of lenders will give you the option of interest-only as an alternative. 

The table below shows what the repayments on a £175k interest-only mortgage would look like across different interest rates and a standard term length of 25 years.

The product type will also have a bearing on the amount you will pay in interest. Fixed-rate and variable-rate mortgages come with different rates depending on how long you lock in for and whether you pay an upfront product fee.

Mortgage amount 

Perhaps £175,000 is a ballpark mortgage amount for you and you are interested to see how your repayments might vary if you were to borrow slightly more or less. The table below shows the repayments for similar amounts around the £175,000 mark, based on a 4% interest rate, a 25-year term length and a capital and repayment agreement.

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How much do you need to afford a £175k mortgage?

All of the mortgage applications would need combined annual income of just below £39,000 as most mortgage lenders will cap your maximum borrowing based on 4.5 times salary. You may still have options if you earn less than this as other lenders base their maximum lending on 5-6 times salary. You might also be able to declare supplemental income.

Enter your household income into our calculator below to get an idea of whether you qualify for a £175k mortgage.

Compare £175K mortgage rates online

You can compare the latest rates on £175,000 mortgages using our free mortgage sourcing tool below. We have set this tool to display results for a 60% LTV (40% deposit) mortgage by default but you can manually change this by altering the mortgage amount and property value to match your personal circumstances. More options are available via the filters menu in the bottom left.

Tips to help you reduce your payments

There are ways that you can keep the repayments on a £175k mortgage to a minimum. The following tips can help you do exactly that:

• Maximise your deposit contribution: A larger deposit reduces your loan-to-value (LTV) ratio, which is a key factor for lenders. This not only opens up a wider choice of mortgage deals but can also grant you access to the most competitive interest rates, which are typically offered at 60% LTV or below.

• Conduct a credit report audit: Before applying, it's wise to review what lenders will see. Obtain your credit files and scrutinise them for any inaccuracies. Reporting and correcting outdated information can enhance your credit score, making you a stronger candidate for more favourable mortgage offers.

• Assess a longer mortgage term: Spreading your repayments over a longer period is an effective way to lower your monthly outgoings and manage your immediate budget. This should be weighed against the higher amount of total interest you will pay over the full duration of the loan.

• Consult a whole-of-market broker: A broker's expertise and industry contacts can be invaluable. They can navigate the complexities of the market and often have access to exclusive deals not available directly to customers, which can result in significant long-term savings.

Applying for a £175,000 mortgage

After working out the costs involved, your next step should be to apply for your £175,000 mortgage. The best way to begin the process is by speaking to one of our mortgage brokers so they can find the best deal for you.

Get started here to book in a free, no-obligation chat with one of our advisers so they can guide you through the application process.