What Are The Monthly Repayments On A £100,000 Mortgage? (2024)

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£100,000 Mortgage: Monthly Repayments & Income Requirements

The repayments on a £100,000 mortgage will differ from person to person depending on the type of mortgage you get. Mortgage repayments are affected by term length; the longer your term, the smaller your monthly repayments but the more you’ll pay in the long term.

Interest rates will affect how much you pay, the higher the rate the more you’ll pay and the mortgage type can also affect your repayments. An interest-only mortgage, for example, will only repay the interest charges not any of the money you’ve borrowed.

In this article, we’ll look at what the monthly repayments for a £100,000 mortgage could be, how much annual income you’ll need to acquire a mortgage for this amount, how much deposit you’ll need, and why using a mortgage broker can help secure the lending you need at the most competitive interest rates.

How much would a 100k mortgage cost monthly?

At the time of writing (May 2024), the average monthly repayments on a £100,000 mortgage are £585. This is based on current interest ranges being around 5%, a typical mortgage term of 25 years and most borrowers opting for a capital repayment mortgage. Based on this, you would repay £175,377 by the end of your mortgage term.

Use our calculator below to get more ideas of your potential monthly repayments. You can use various interest rate examples, input the amount you’re looking to borrow (in this case, £100,000), and the preferred term for your mortgage.

You can also speak to one of the advisors we work with for a representative idea of what you might repay. They can help you secure favourable terms and lower repayments than you might get if you try to secure a mortgage by yourself.

How much do you need to earn to get a £100k mortgage?

The amount you can borrow is based on your salary. Most lenders will loan around 4-4.5 times your income. So, to get a £100,000 mortgage, you’ll need to earn between £18,000 to £25,000. This is below the average UK annual salary, currently £34,900 (May 2024).

You might want to consider getting a joint mortgage with someone if you earn less than the average salary or the figures listed above. By doing so, your combined earnings can be used for this calculation.

Some lenders may also be willing to offer5 times or even 6 times your annual salary, but this will depend on your circ*mstances and whether you meet their often stricter eligibility criteria. For example, most lenders will only borrow 6 times the annual salary tocertain professionsdeemed low risk, such asteachersandnurses.

The chart below helps to illustrate how this works in more detail.

You can enquire with one of the advisors we work with to find out how they can help you increase your chances of being approved for a £100,000 mortgage.

Bear in mind that if you’re applying for a joint mortgage with one or more other applicants, lenders will usually look at your combined earnings. Limited options are available, usually through a broker, for people who need to borrow up to 6x salary.

The above table is for comparative purposes only. You should talk to your mortgage lender or broker for the most up-to-date information on affordability criteria.

If you’d like to test this for yourself, based on your annual income, take a look at our mortgage affordability calculator below:

How much deposit do you need for a £100,000 mortgage?

Currently, the minimum deposit requirements imposed by lenders for a residential mortgage are between 5%-10% – this is based on the property value NOT the mortgage amount.

If you were buying a property with a value of £100,000 (rather than borrowing this amount) you’d need a deposit of between £5,000-£10,000 at least, and your mortgage would be between £95,000-£90,000.

It’s possible to secure a mortgage for £100,000 with no deposit, but this is extremely rare.

You may need a higher deposit of at least 25% if you have issues with bad credit or are looking for a mortgage involving a non-standard construction property. You should note this will reduce the pool of lenders available to you.

Most lenders ask for a minimum deposit of 20% for buy-to-let mortgages, although a mortgage broker with experience in this area should be able to identify some who will ask for less.

The higher your deposit, the more likely you will qualify for the most competitive interest rates as mortgage lenders reserve their best rates for mortgages with the lowest loan-to-value (LTV). You can see how this works on our calculator below.

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How to get a £100,000 mortgage

After making your calculations, the next step in your mortgage application should be to speak to a mortgage broker to ensure you get the best rate and deal on your mortgage. Enquire with us and we will match you with the right advisor for free.

They’ll be able to help with:

• Deposit requirements: You’ll need to save a minimum deposit of 5% to 10% for a £100,000 mortgage. How much this figure will be depends on the value of the property, but a 10% deposit on a £100,000 house would be £10,000. A simple way to help you save money is to set up a savings account and put a percentage of your monthly wage, around 10 to 15%, into the account each month.
• Downloading and optimising your credit reports. Before you apply it’s important to check your credit history to make sure no bad credit issues exist and remove any inaccurate or outdated information that could hinder your chances of securing the mortgage you need.
• Gathering all the necessary paperwork required for your application:Your broker will be able to guide you through the application process and all the typical documents required – proof of income, at least three months of bank statements, personal ID, proof of address,evidence of deposit, latest P60 form etc.
• Finding the right lender offering the best rates. Your broker can save you a lot of time and, potentially, some money by identifying the mortgage lenders currently offering the most competitive interest rates across the market.
• Guiding you through the process: Getting a mortgage can be difficult, especially if it’s your first application. The right mortgage broker can help you with any issues you may face along the way, look after your interests and be a lifeline in case anything goes wrong.

Example monthly repayments for a £100k mortgage

Below are some examples to give you an idea of what your payments could be for a mortgage this size, and to illustrate how different factors – namely the interest rate and term – can change the monthly cost.

For interest-only mortgages, the repayment remains as is regardless of the term. So, for example, the repayment shown for 6% – £500 per month – would be the same if you opted for a 15-year term or a 30-year term as the capital owed doesn’t reduce and is paid off in full at the end using a separate repayment vehicle.

Factors that affect monthly repayments

Here are some of the key criteria that could have an impact – both directly and indirectly – on your mortgage repayments:

Interest rates

The rate you secure will influence the monthly cost. Everything else being the same, a higher interest rate will mean you pay more for a £100k mortgage monthly. The rates available on the market can vary. So, it’s crucial to deal with a lender who’ll offer the most competitive rate for your circ*mstances.

Fixed or Tracker

You’ll also have the option to choose between a fixed rate vs a tracker mortgage. Usually, a fixed rate will be higher, increasing your monthly repayment. But, locking in a rate can allow you to better plan your finances.

Term Length

How long you take out a mortgage for can affect your rates and directly impact your monthly cost for a £100k loan. A longer term will likely reduce your monthly repayments, but it usually means paying more over the life of the mortgage.

Your age

Although it’s possible to get a mortgage at almost any age, time on your side can lead to better deals from lenders. This could mean lower rates and monthly repayments for your £100,000 mortgage.

The role your credit score plays

It’s worth downloading all your credit reports before applying for a mortgage because these scores can make a difference to the number of lenders willing to consider your application and, therefore, indirectly affect the rates you’ll be offered. Your broker can help with any mistakes and show you areas to improve. If you do have bad credit, there will still be specialist lenders available.

If you’re unsure what your credit score is or want to check before you go any further, use the free tool below:

Other mortgage costs to consider

There are a few other additional charges to think about that may impact the monthly costs when setting up a mortgage worth £100,000:

• Product fees: some mortgages come with fees to set it up. This can include a booking fee, an arrangement fee, and a valuation fee. If you include these costs onto your total loan, it can mean nothing to pay upfront, but it will increase how much you pay each month.
• Insurance: you will likely need to consider the additional costs of any insurance you may have to purchase. This can include building insurance, life insurance to cover the mortgage if you die, income protection if you’re unable to work, or critical illness cover to help if you get diagnosed with a serious condition.
• Stamp duty: depending on the value of the home and if it’s your main residence, you might have to pay stamp duty. If you’re a first-time buyer or if it’s a residential property under £250,000 – this tax won’t apply.
• Legal fees: these costs usually need to be paid during the purchase process. So it won’t affect the monthly payments, but it is an additional cost to factor into your calculations.

Why use Online Mortgage Advisor?

Finding someone who has plenty of experience securing £100k mortgages with low payments can take a lot of time and effort. Luckily, the brokers we work with are industry experts and can introduce you to the right lender from day one.

We offer a free, broker-matching service. This means we’ll quickly assess your personal situation and mortgage needs, and then pair you up with an expert broker who’ll find you the best home loan with the lowest repayments.

Just call 0808 189 2301 or make an enquiry. We’ll arrange a free, no-obligation chat between you and your ideal mortgage broker today.

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