How the size of your deposit makes a difference to the monthly cost of your mortgage

house depositIn this article we take a close look at how the monthly cost of your mortgage varies dramatically with the size of the deposit you can put down when you buy a house.

Lenders lend in Loan To Values ( What is Loan To Value? ) therefore the smaller the deposit the higher the interest rate and the larger the deposit the lower the interest rate.

The following examples are based on a First Time Buyer purchasing their first property for £125,000 and shows what monthly mortgage payments would be depending on current interest rates and having a 5%, 10% or 15% deposit available.

The rates are quoted for 2, 3 & 5 year fixed rates with and without lenders arrangement fee on a repayment mortgage over 35 years.

5% DepositInterest RateMortgage PaymentArrangement Fee
2 year fixed2.69 %£ 437 per month£ 892
3 year fixed2.99 %£ 457 per month£ 599
5 year fixed3.09 %£ 463 per month£ 599
2 year fixed3.18 %£ 470 per month£ 0
3 year fixed3.27 %£ 475 per month£ 0
5 year fixed3.47 %£ 488 per month£ 0
10% DepositInterest RateMortgage paymentArrangement Fee
2 year fixed1.89 %£ 370 per month£ 995
3 year fixed2.18 %£ 387 per month£ 995
5 year fixed2.34 %£ 397 per month£ 995
2 year fixed2.17 %£ 383 per month£ 0
3 year fixed2.44 %£ 399 per month£ 0
5 year fixed2.51 %£ 403 per month£ 0
15% DepositInterest RateMortgage paymentArrangement Fee
2 year fixed1.69 %£ 339 per month£ 999
3 year fixed1.99 %£ 355 per month£ 995
5 year fixed2.14 %£ 363 per month£ 995
2 year fixed1.99 %£ 352 per month£ 0
3 year fixed2.24 %£ 366 per month£ 0
5 year fixed2.39 %£ 374 per month£ 0

All the above rates are from various lenders as Manchester Mortgages are whole of market ( independent ) mortgage brokers and are subject to you meeting lenders criteria.

Mortgage rates are subject to change without notice and are based on rates available as at 8 November 2018.

As you can see there are many permutations available with thousands of other rates available with and without arrangement fees.

Manchester Mortgages welcomes enquiries not only from First Time Buyers but Home-movers, Re-mortgagors, and Buy to Let investors.

Save yourself the stress of trying to work out which mortgage is best for you by calling Manchester Mortgages on 0161 706 0242 to discuss your requirements.