Calculate your monthly repayment
Use this capital repayment mortgage calculator to estimate monthly payments, total interest, and how overpayments can shorten your mortgage term.
What is a capital repayment mortgage?
A capital repayment mortgage means each monthly payment includes two parts: interest and capital (the amount you borrowed). Over time, you reduce the loan balance until it reaches zero by the end of the term. This is different from an interest-only mortgage, where you pay only interest monthly and still owe the full loan at the end.
Because you are paying down the principal every month, your risk of a large final balance is lower. The trade-off is that monthly payments are typically higher than an interest-only structure.
How this calculator works
This tool uses the standard amortization formula used by banks and mortgage lenders:
- Loan amount: the total borrowed
- Interest rate: annual nominal rate, converted to a monthly rate
- Term: years converted to total months
- Overpayment: optional extra amount paid each month to reduce term and interest
It then simulates month-by-month repayment to estimate:
- Expected monthly payment
- Total paid over the life of the mortgage
- Total interest cost
- Time and interest saved from overpayments
Why overpayments can make a big difference
In the early years of a mortgage, a bigger share of your payment goes toward interest. Even a modest overpayment can reduce the balance earlier, which means future interest is calculated on a lower amount. This creates a compounding benefit over time.
Example effect of overpaying
If your standard payment is £1,300 and you overpay by £100 each month, you are not just adding £100 of extra principal—you are also reducing future interest charges. Depending on rate and term, that can save thousands.
Reading your results
Standard monthly payment
This is the contractual payment (excluding your voluntary overpayment) based on loan, rate, and term.
Actual monthly payment
This includes your optional overpayment. If overpayment is zero, it matches the standard payment.
Total interest and total repaid
Total interest is the cost of borrowing over the entire mortgage timeline. Total repaid is principal plus interest combined.
Payoff time
The tool converts repayment months into years and months so you can quickly see how long the mortgage lasts under your assumptions.
Tips for using a mortgage calculator wisely
- Test multiple rates: try higher and lower rates to stress-test affordability.
- Model realistic overpayments: set an amount you can maintain consistently.
- Review annually: update assumptions when rates change or your income increases.
- Account for fees separately: arrangement fees, insurance, and legal costs are not included in basic payment formulas.
Common mistakes to avoid
- Assuming your current rate will never change (important for variable-rate deals).
- Forgetting that some lenders cap overpayments without penalties.
- Comparing only monthly payment instead of total interest over the full term.
- Ignoring emergency savings while overpaying aggressively.
Capital repayment vs. interest-only at a glance
Capital repayment
- Higher monthly payment
- Loan balance reduces each month
- No large final principal balloon (if payments maintained)
Interest-only
- Lower monthly payment initially
- Principal remains outstanding
- Requires a separate repayment strategy
Final thought
A capital repayment mortgage calculator is one of the best planning tools for home buyers and existing borrowers. Use it to compare scenarios, set realistic budgets, and make smarter decisions about overpaying. A few minutes of testing different assumptions can save you years of repayments and substantial interest costs.
Note: This calculator is for educational estimates only and does not replace regulated mortgage advice.