Example of Conventional Mortgage
The property price is £100,000. The bank will be looking for a 10% deposit, with a mortgage period of 30 years, on £90,000 with an annual interest rate of 8%.
The buyer will pay £1000 stamp duty on purchasing the property.
- The monthly repayment figure would be £660.39. Each payment makes up some of the interest due and some of the capital borrowed.
- The buyer will make 360 monthly payments in total. The total cost borrowed will be approximately £237,740.40.
This figure includes the amount of £147,740.40, which is the interest paid on the £90,000 borrowed.
