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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?
At the time of writing (November 2024), 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 current UK market.
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 have run some calculations and have a better idea of how much your mortgage will cost, you can compare rates and deals from lenders across the market for free on Teito and choose the one you want in real time - 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.
Mortgage Amount | Interest Rate | Monthly Repayments | Overall Repayment |
£175k | 3.5% | £876 | £262,827 |
£175k | 4% | £924 | £277,114 |
£175k | 4.5% | £973 | £291,812 |
£175k | 5% | £1,023 | £306,910 |
£175k | 5.5% | £1,075 | £322,396 |
£175k | 6% | £1,128 | £338,258 |
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.
Mortgage Amount | Term Length | Monthly Repayments | Overall Repayment |
| £175k | 10 years | £1,772 | £212,615 |
£175k | 15 years | £1,294 | £233,002 |
£175k | 20 years | £1,060 | £254,512 |
£175k | 25 years | £924 | £277,114 |
£175k | 30 years | £835 | £300,772 |
£175k | 35 years | £775 | £325,439 |
£175k | 40 years | £731 | £351,068 |
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.
Mortgage Amount | Interest Rate | Interest-only Payments (Monthly) | Overall Repayment |
£175k | 3.5% | £510 | £328,125 |
£175k | 4% | £583 | £350,000 |
£175k | 4.5% | £656 | £371,875 |
£175k | 5% | £729 | £393,750 |
£175k | 5.5% | £802 | £415,625 |
£175k | 6% | £875 | £437,500 |
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.
Mortgage Amount | Monthly Repayments | Overall Repayments |
£155k | £818 | £245,444 |
£165k | £871 | £261,279 |
£175k | £924 | £277,114 |
£185k | £976 | £292,949 |
£195k | £1,029 | £308,785 |
£205k | £1,082 | £324,620 |
Calculations all done? Here are your options now...
Other costs to consider
Your mortgage repayments aren’t the only cost you will need to consider when applying for a mortgage. There are additional fees to factor in as well, and they are as follows:
- Product fees: Can range between nothing and £2,000. Fee-free deals often come with higher rates, but the fee itself can sometimes be added to the mortgage.
- Booking fee: An admin cost as part of the mortgage application process. It can range between £99-250 and is sometimes rolled into the product fee.
- Valuation fee: Some lenders will expect you to foot the cost of having the property you’re buying valued, and this can set you back between £250-1,500.
- Telegraphic transfer fee: A small fee to cover the cost of transferring your mortgage funds to your solicitor so the deal can be closed, usually between £25 and £50.
- Account fee: Another admin cost, usually between £100 and £300, to cover the set up, maintenance and eventual closure of your mortgage account held by the lender.
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:
- Put down a larger deposit: Not only would you need to borrow less, putting down extra deposit can reduce the loan-to-value (LTV) ratio and help you qualify for a lower rate.
- Improve your credit situation: Waiting for any bad credit to disappear from your credit files, paying off debts you’re in a position to clear, and paying any existing bills and credit agreements on time ahead of your application can also help you land a lower rate.
- Consider a longer mortgage term: This will reduce your monthly payments in the short term (on a capital repayment agreement), but you will be paying more in interest overall.
- Consider interest-only: Interest-only mortgages have lower monthly payments but you will need a repayment vehicle to settle the debt at the end of the term. Be sure to seek professional advice from a qualified mortgage broker before choosing this option.
Applying for a £175,000 mortgage
After working out the costs involved, your next step should be to apply for your £175,000 mortgage, and you can get started by comparing rates and deals for free on Teito.
Our free service allows you to view deals from across the market, and we have mortgage brokers on hand to support you along the way and take care of the application process. It takes minutes to secure an agreement in principle on Teito - get started here.
FAQs
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.
Choosing an Adviser
Selecting a qualified and experienced mortgage adviser is of great importance. To choose a suitable adviser, evaluate their qualifications, experience, and reputation, and ensure they are regulated by the Financial Conduct Authority (FCA).
Read reviews from previous clients and make sure they provide a clear explanation of the products and services they offer, as well as the fees and charges associated with them.