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£150,000 Mortgage Repayment Example

Author: Myles Robinson - Expert Finance Advisor

Posted: Jun 6, 2022

£150,000 mortgage repayment example

This article will explain what your mortgage payments could be for a £150,000 mortgage loan, how much deposit you’ll require for a 150000 mortgage, and how to get the best interest rates for a £150,000 mortgage.

Take a look at the mortgage repayment calculator to get an idea of the monthly repayments cost of a mortgage for this amount.

We receive enquiries about mortgages up to this amount daily. Our mortgage brokers are all-market and best equipped to help you find the best mortgage deals for you. We provide mortgage advice free of charge.

 

What is the monthly cost of a £150,000 mortgage?

Customers frequently ask us “What are the average monthly repayments for a £150K mortgage?”. The answer is dependent on many factors. Your credit history will impact the interest rate you pay. This will also affect the number of your monthly mortgage repayments.

Monthly repayments for a £150K mortgage will depend on the interest rate and the length of the term.

Below is an example of how £150k mortgage payments could differ depending on these variables.

The mortgage rate that you are eligible for will depend on how much deposit you have and what your profile is as a borrower.

Contact us if you have any questions about the cost of a 150,000 Mortgage. Our expert advisors will provide you with mortgage quotes based on your particular circumstances. They will also connect you to the most favourable rates.

Is the term of your mortgage affecting the monthly repayments?

The short answer to that question is yes. It is often asked what the mortgage repayments are for a 150,000 mortgage. It all depends on your financial situation and how much you are able to afford each month.

The following table shows how reducing your mortgage term will impact your monthly payments and your total amount to repay for the mortgage deal. It is based on an average interest rate of 3%.

As you can see the term of your mortgage has a significant impact on how much you end up paying and the monthly payments you make.

A mortgage with a 20-year term instead of a 25-year term can save you more than £13,700.

For expert advice about which term is best for you, talk to one of our mortgage advisors. They can provide you with specific mortgage quotes based on your financial situation.

What amount of income do you require?

We are often asked how much income we need to get a 150,000 mortgage. This depends on many factors such as where you earned your income, credit history, and how much you deposit.

Depending on your personal circumstances, the answer may be more complicated or simpler.

For more information, see our article below, How much should you earn to get a mortgage to purchase a £150,000.

What is the minimum deposit?

The amount you are willing to borrow is proportional to the property’s value. This is called the loan-to-value (LTV) ratio.

You can borrow 90% if you have a £15,000 down payment on a £150,000 property. Your LTV ratio will be 90%.

For residential mortgages, the minimum deposit required is currently 5% or 95% LTV. For a 150,000 mortgage, you will need to have a minimum deposit of £7.5K.

Is it possible to get a £150,000K loan without putting down a deposit?

100% mortgages are available. However, these are usually limited to family loans in which a relative, often parents, deposits the equivalent of the deposit into a mortgage lender account as security.

They can return their money after a certain period of time, often three years, and if they meet certain criteria.

You may also be able to borrow money from the government Help To Buy or Shared Ownership if you have trouble getting a deposit.

How does bad credit impact the amount of deposit required for a £150k mortgage loan?

The short answer to this question is yes. Mortgage providers will consider you a higher risk if you have bad credit. Therefore, a larger deposit is required.

Credit problems may include…

  • Credit history is required
  • Credit score low
  • Late payments
  • Mortgage payments not made
  • Defaults
  • CCJs
  • IVAs
  • Debt management plan
  • Repossessions
  • Bankruptcy
  • Payday loans
  • Multiple credit problems

Different mortgage lenders may require different deposits or loan-to-value depending on your situation and how you access the risk.

Some lenders will accept a lower deposit and a higher LTV if you have relatively good credit.

However, if you have a credit history that includes serious issues, such as repossession, other debts and bankruptcy then the lender may require a higher deposit to ensure a lower LTV. This means lower risk. Payday loans are a risky option. It’s usually harder to get a mortgage if you have payday loan use in your file.

You may need to deposit a higher amount depending on the lender’s perceived risk.

This is a demonstration only. You should speak to your mortgage broker or lender for current rates and information.

This article will touch more on bad credit history. However, if you are unsure whether your credit history will pose a problem, speak to one of our advisors today. They are experts in finding mortgages for customers who have bad credit.

Can you get a £150,000 buy-to-let mortgage?

Yes. However, mortgages can have different rules. It’s important to be aware of these differences before you begin.

While some mortgage providers require a larger deposit, such as 25%, others will accept 15% subjected to certain criteria. Some providers may require a minimum income requirement of around £25k. However, affordability comes down to whether your forecast rental income can cover mortgage repayments by 125-130%.

Lenders may not offer you a buy-to-let deal if your home has been owned for at least six months. However, specialist providers may be able to consider first-time buyers provided that other criteria are met.

Most buy-to-let mortgages are set up using an interest-only basis. See the section below to see examples of monthly payments for a £150,000 mortgage.

Is it possible to get a £150,000 interest-only mortgage?

Yes, there are many providers that offer these products to residential borrowers who have a viable and valid repayment strategy.

You will need to deposit slightly more to be eligible for an interest-only mortgage. Most lenders will only accept up to 75% loan to value (LTV). A few lenders will consider up to 80% and a few up to 15% depending on the circumstances.

Repayment agreements can be more beneficial than interest-only mortgages, with the main benefit being the lower monthly cost.

An interest-only agreement allows the borrower to pay only the interest each month, and the entire loan amount at the end. Repayments allow you to pay off the loan as you go.

Below is a table that compares mortgage payments on a £150,000 loan based on interest-only vs. repayments based on 4.4% interest.

Send an enquiry today. Our experts will give you this information over the telephone and help you connect with the right mortgage lender to find the best mortgage deal for you.

Other factors that could affect a £150,000 Mortgage Application

Your credit rating, along with other factors (see above), may play a role in whether your £150,000 mortgage application is approved.

Type of property

Non-standard construction is not accepted by some mortgage lenders. Some lenders won’t lend on properties with non-standard construction (e.g. thatched roof, timber frame), while others will. Learn more about non-standard construction mortgages.

Your age

Some mortgage providers place age restrictions and won’t lend money to anyone older than 75. Others have 85. A minority of providers won’t impose an upper age limit on their mortgages if they are confident that you can pay the repayments after retirement.

Type of income

Lenders are most attracted to those with high-paying PAYE salaries from a full-time jobs. Anything else falls under the non-standard category which can lead to lower rates.

There are lenders that specialize in self-employed mortgages. They also offer mortgages with bonus income or commission. Additionally, mortgage lenders will accept benefits as an additional income. Learn more about income types and mortgages.

No matter if you have property already

If you are a homeowner and you plan to buy a second property, some lenders may consider you a higher risk. There may be additional income requirements and a higher deposit requirement. Additionally, there might be more scrutiny about mortgage affordability.

Credit rating

Bad credit is not necessarily a problem. It’s possible to still get a mortgage. This depends on how severe the issue is (missed phone bill payments are less severe than recent bankruptcy) and how long the issue has been on your file (the better, the longer).

Customers with bad credit may need a specialist lender that is more understanding of their situation. Whole-of-market advice can be very important.

£150,000 mortgages for self-employed borrowers

You can get a mortgage even if you are self-employed. However, you will need to work with a specialist lender in order to get the best rates. Some lenders will not consider your income standard and offer you a lower rate because of the perceived risk.

The most common income lender accepts is…

  • EmployedBonus – Overtime – Commission – Car / Town / Shift Allowances – Mortgage Subsidy – Other Cash Employer Benefits
  • Solo Trader: Net Profit (if using accounts) and Total Income (if using SA302s).
  • Partnership: Your share of net profit (if you use accounts) – Your share in total income (if you use SA302s).
  • Ltd Company – Your share in director’s salaries – Your share in dividends – Lenders may consider net profit when there have been large business expenses or a sum that was left in the company.

For a mortgage, most lenders require that self-employed borrowers provide evidence of three years worth of accounts. However, some will accept only two years, while a few others will accept up to three. Learn more about mortgages for the self-employed.

£150,000 secured loan vs £150,000 mortgage?

Secured loans, also known as second charge mortgages and homeowner loans, can be a viable option to property owners who need capital but are unable or unwilling to remortgage.

You can get a £150,000 homeowner loan secured on your property. However, you must meet the lender’s eligibility requirements. Factors such as income, adverse credit, and non-standard income are generally less restrictive than LTV requirements.

Secured loans are often as affordable as conventional mortgages. They can also be quicker to arrange and have no fees for early settlement.

Where can I find a £150,000 calculator for a mortgage?

You can use this calculator below:

 

Talk to an expert mortgage broker

Are you still wondering “Can I afford a £150k mortgage?”

We will match you with one of our expert brokers. They’ll be happy to answer any questions you may have and help find the right mortgage at the best rate.

Contact us here today for free mortgage advice.

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