Mortgage Notes

Methodology

How the numbers work

Every calculator and rate figure on Mortgage Notes is built on explicit assumptions. They're documented here.

Mortgage repayment maths

Monthly payments are calculated using the standard amortisation formula:

M = L × [r / (1 − (1 + r)−n)]

Where L = loan amount, n = number of monthly payments (term × 12), and r = the monthly interest rate. We derive r as (1 + annual rate)1/12 − 1 to match most UK MCOB presentation. This produces figures typically within pence of lenders' own calculations — occasional pound-level differences can arise from lender-specific rounding and how fees are packaged into the quoted APRC.

SDLT (stamp duty)

Stamp Duty Land Tax is calculated using England & Northern Ireland residential bands effective from 1 April 2025. First-time buyer relief, additional-property surcharge (5% from 31 October 2024) and non-resident surcharge (2%) are applied as described on the SDLT guide. Scotland (LBTT) and Wales (LTT) are not modelled.

Take-home pay (income tax and NI)

Net monthly income is calculated using 2025/26 England, Wales & Northern Ireland income tax bands and Class 1 NI rates:

  • Personal allowance: £12,570 (tapered: reduced by £1 for every £2 above £100,000)
  • Basic rate 20% to £50,270, higher rate 40% to £125,140, additional rate 45% above
  • Class 1 NI: 8% between £12,570 and £50,270; 2% above

This assumes a single employed person with no pension contributions, student loan repayments, or other deductions. Scotland has different income tax bands; we don't model them because this site is England-focused.

Rate data

The rate table used by the affordability and borrowing calculators is maintained in src/data/rates.json and refreshed daily. Sources:

  • Bank Rate: bankofengland.co.uk (official).
  • CPI inflation: ons.gov.uk (official).
  • Representative best-buy rates by LTV: weekly aggregation from Moneyfacts, Which?, HomeOwners Alliance and Uswitch rate roundups. These are editorial "best-buy" figures, not an exhaustive lender comparison.

The last-updated date is stamped next to every rate figure. If the date is more than 7 days old, the pipeline has failed — please let us know.

House-price data (regional)

Average prices and first-time-buyer typical prices are derived from the HM Land Registry UK House Price Index and ONS private rent and house prices bulletins. Regional figures are starting points for planning, not precise postcode estimates. Always verify against the specific town or area you're buying in.

Buying fees

Conveyancing, survey and removals figures in the affordability calculator are midpoints of 2026 market ranges sampled from multiple providers. They scale with property price using bracketed tiers. Actual quotes always vary; the calculator's values are planning anchors, not quotes.

Affordability multiples

The borrowing calculator uses a user-adjustable income multiple with a default of 4.5×. Most UK lenders sit between 4× and 4.5×. 5× and 5.5× is available on specific products (e.g. Nationwide Helping Hand for first-time buyers; professional-scheme products for doctors, lawyers and teachers on set pay scales).

What we don't model

  • Lender-specific affordability tests (committed expenditure, stress rates, dependents)
  • Self-employed / contractor income treatment (each lender differs)
  • Joint Borrower Sole Proprietor (JBSP) income summation rules
  • Scheme-specific discount application (First Homes, Shared Ownership share maths, Help to Buy redemption value)
  • Service charges, ground rent, or leasehold enfranchisement costs
  • Scotland (LBTT) and Wales (LTT) tax calculations

These gaps are deliberate: each requires a model that would either be wrong for most users or misleadingly specific. Speak to a broker for any of these calculations in detail.

Updates

This methodology page is updated whenever we change a calculation. Change log visible in the site's GitHub history when we move to public repository.