How much would I have to pay for £250,000 at 5% for 30 years?


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Kenny Floyd answered

If you were to borrow £250,000 with a 5% interest rate, for a period of 30 years, you would be looking at paying back just over £480,000 in total.

Assuming it's relating to a mortgage, the exact sum you would pay back would depend on which kind of mortgage you take out, and who you take it out with. But between £480,000 and £490,000 is a very close approximation for the standard monthly repayments system, for whomever you take out your mortgage with.

If you're thinking about buying a home, there are a lot of things to remember and consider. The most important thing of all is to remind yourself that interest rates are very much subject to change, so you have to take into account the fact that the initial 5% rate is likely to rise, especially with the current economy bouncing back.

So whilst the 5% rate would see you paying back roughly £480,000, even a small rise to 6% would see that total sum increase to closer to £540,000. It's therefore necessary to know you can afford your monthly repayments comfortably, even with the anticipation of rising interest rates, before taking out a loan as big as that.

To help keep track of your money, here's a video showing you how to set up your own file in Excel of your monthly repayments (written in US Dollars, rather than Pound Sterling).

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