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A mortgage of £250,000 is very close to the national average, so we have plenty of experience helping people secure home finance for this amount.
Here you will learn how much you need to earn to get a mortgage of this size, what the repayments will be and how we can help you with your application.
How much do you need to earn to afford a £250,000 mortgage?
You will need an annual household income of around £55,000 to get approved for a £250,000 mortgage as most lenders won’t let you borrow more than 4.5 times salary.
However, it may be possible to secure a £250,000 mortgage with less income than this as a minority of mortgage providers will consider 5-6 times salary. These lenders tend to have stricter criteria and will only offer these income multiples to people with strong applications.
You can work out whether your income stretches far enough by using our mortgage affordability calculator below:
What would your mortgage repayments be?
The average monthly repayment on a £250k mortgage is £1,320. This example calculation is for a capital repayment mortgage with a 4% interest rate taken over 25 years.
That would be a typical mortgage deal in the current UK market, and entering it would mean paying back a total of £395,878 across the whole term. However, most people’s mortgage payments change each time they remortgage.
The exact repayments you end up with will depend on what interest rate you qualify for, what type of mortgage you choose and which term length you opt for.
You can use our mortgage repayment calculator below to find out how these factors can affect the cost of a £250,000 mortgage.
Factors that affect the cost of a £250k mortgage
Here we will break down the main variables that shape the cost of a £250,000 mortgage, complete with example calculations for added context.
Interest rate
The interest rate a lender is prepared to offer you will depend on the overall strength of your mortgage application, largely assessed on the amount of deposit you have and your credit history.
The table below shows how the cost of a £250,000 mortgage can change depending on the interest rate the borrower qualifies for. These example calculations are based on a capital repayment mortgage taken out over 25 years.
Mortgage Amount | Interest Rate | Monthly Repayments | Overall Repayment |
£250k | 3.5% | £1,252 | £375,468 |
£250k | 4% | £1,320 | £395,878 |
£250k | 4.5% | £1,390 | £416,874 |
£250k | 5% | £1,461 | £438,443 |
£250k | 5.5% | £1,535 | £460,566 |
£250k | 6% | £1,611 | £483,226 |
Term length
A typical mortgage term is 25 years but most lenders will give you the option of longer or shorter. The greater the term, the lower your monthly payments will be, but longer agreements usually cost more overall due to having more interest instalments.
The table below shows how the cost of a £250,000 capital repayment mortgage can vary across different term lengths, with a 4% interest rate used for example purposes.
Mortgage Amount | Term Length | Monthly Repayments | Overall Repayment |
£250 | 10 | £2,531 | £303,735 |
£250k | 15 years | £1,849 | £332,860 |
£250k | 20 years | £1,515 | £363,588 |
£250k | 25 years | £1,320 | £395,878 |
£250k | 30 years | £1,194 | £429,674 |
£250k | 35 years | £1,107 | £464,913 |
£250k | 40 years | £1,045 | £501,526 |
Repayment type
Capital repayment mortgages, where the borrower repays a proportion of the debt plus interest each month, are the most popular residential mortgage type in the UK.
The main alternative is an interest-only mortgage, which only requires borrowers to pay the interest each month and the debt at the end of the term.
The table below shows what the repayments on a £250,000 interest-only mortgage would look like across different interest rates, if taken out on a standard 25-year term.
Mortgage Amount | Interest Rate | Interest-only Payments (Monthly) | Overall Repayment |
£250k | 3.5% | £729 | £468,750 |
£250k | 4% | £833 | £500,000 |
£250k | 4.5% | £938 | £531,250 |
£250k | 5% | £1,042 | £562,500 |
£250k | 5.5% | £1,146 | £593,750 |
£250k | 6% | £1,250 | £625,000 |
In addition to the mortgage’s repayment type, the mortgage’s product type will also have a bearing on the cost as fixed-rate and variable rate mortgages are priced differently, with costs and fees varying across the two main types.
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£250,000 buy-to-let mortgages
The repayments on a buy-to-let mortgage are calculated in the same way as they are for residential, but investment mortgages generally cost more each month and overall.
This is because the rates are typically higher for buy-to-let. The other main difference is that the interest-only repayment type is the norm for landlords.
With these factors in mind, the typical cost of a £250,000 buy-to-let mortgage would be £938 per month and £531,250 overall. A slightly higher example interest rate of 4.5% was used for this calculation, along with a standard 25-year term and the interest-only repayment type.
How to apply for a £250,000 mortgage
The way to apply for a £250,000 mortgage is to speak to a mortgage broker before you approach any lenders and let them do all of the legwork for you.
By applying for your mortgage through a broker, you will gain access to a wider range of deals, including exclusive rates that aren’t available to borrowers who go direct.
Other benefits of applying for a £250k mortgage through a broker include:
Bespoke advice from start to finish
Access to the entire market
Help with all of your paperwork
No fee for your initial consultation
Ready to take advantage of a free, no-obligation chat with one of Echo Finance’s mortgage brokers to find out how much you could save? Get started here.
FAQs
It is only slightly over the national average size for UK mortgages right now. There are no mortgage lenders who will place restrictions and caveats on a mortgage of this amount.
Find your local adviser
- Residential mortgages: Everything from fixed-rate to tracker mortgages for first-time buyers, homemovers and remortgage borrowers
- Specialist mortgages: For borrowers who fall outside of standard lending criteria, including people with bad credit, self-employed professionals and more
- Later-life lending: Including advice on equity release, mortgages for pensioners and retirement interest only (RIO) mortgages
- Bridging & Commercial: We have specialist advisors on hand for commercial mortgages, bridging loans, development finance and more
- Insurance & Protection: Including life, home and critical illness cover for families and individuals, as well as landlord and business protection insurance
Echo Finance is regulated by the Financial Conduct Authority and is reviewed annually by an independent compliance company. All of our brokers and advisers hold industry-standard qualifications, such as CeMAP, CeRER and DipMap, where required.
We are committed to providing advice through the channels that best suit your needs. Our brokers can provide advice via phone, email, video and web chat from anywhere in the UK, but we also aim to offer face-to-face appointments for those who request them.