Mortgage Calculators - Inclusive of Deposit?

Incredibly naive and simple question here, but that's what this forum is for right?

So, here it goes. When using the various mortgage calculators (both repayment and affordability) is the following true:

- Repayment calculator 'mortgage amount required' values are inclusive of deposit, so for a £200k house with £20k deposit, you'd still input £200k?

- Affordability calculator 'loan amount' values are also inclusive of deposit, as are their out putted values. So if you're affordability result is £250k, that is inclusive of any deposit you contribute.

Apologies in advance, and many thanks!

Replies

  • ACGACG Forumite
    21.7K Posts
    Part of the Furniture 10,000 Posts Name Dropper I've helped Parliament
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    All figures are usually in addition to your deposit.

    So if it comes back with a figure of £200k and you have £20k deposit, the maximum purchase price would be £220k.
    I am a Mortgage Adviser
    You should note that this site doesn't check my status as a mortgage adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.
  • RafterRafter Forumite
    3.8K Posts
    Hi TJ


    Affordability is based on the amount you will be borrowing and not deposit.


    So using your numbers above:


    Repayment calculator:
    Property value £200k
    Mortgage amount required £180k
    Your repayment will be based on the £180k borrowed - you don't need to 'borrow' the deposit too.


    Affordability:
    This will tell you how much a Bank or Building Society will lend based on your income and outgoings.
    Add your deposit to this to get the value of the property you can afford - but remember that the lower your deposit the higher the interest rate and you will lead at least a 5% deposit. Remember too that just because they will lend you that amount doesn't mean you shouldn't borrow less and be mortgage free sooner or able to afford to spend on other things other than your mortgage.


    Good luck


    R
    Smile :), it makes people wonder what you have been up to.
  • AnotherJoeAnotherJoe Forumite
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    10,000 Posts Fifth Anniversary Name Dropper Photogenic
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    TJParsons wrote: »
    Incredibly naive and simple question here, but that's what this forum is for right?

    So, here it goes. When using the various mortgage calculators (both repayment and affordability) is the following true:

    - Repayment calculator 'mortgage amount required' values are inclusive of deposit, so for a £200k house with £20k deposit, you'd still input £200k?

    - Affordability calculator 'loan amount' values are also inclusive of deposit, as are their out putted values. So if you're affordability result is £250k, that is inclusive of any deposit you contribute.
    !

    No. Think about it. If you had a deposit of £245,000 so you only needed a mortage of £5,000 then according to your idea, your affordability would be the same as if you borrowed £245,000 because you only had £5,000 deposit. Obviously nonsensical.

    The affordability is how much you can afford to repay which is independent of your deposit.

    Same goes for repayment calculation, if the house costs £250,000 your repayments depend how much you borrow, not the price of the house.
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