How Much Does a £1 Million Mortgage Cost in 2025?
A £1 million mortgage is a significant financial commitment, often associated with high-value properties or investment opportunities in the UK. Understanding the costs involved is crucial for making informed decisions. At Fox Davidson, we’re here to guide you through the process, whether you’re a first-time buyer, , moving home, remortgaging, or investing in property. Below, we break down the costs, factors affecting your mortgage, and how our expert mortgage brokers can help you secure the best deal.
Fox Davidson are a specialist UK mortgage broker. Call or send us an email to discuss your mortgage requirements in confidence with an FCA regulated mortgage broker.
The cost of a £1 million mortgage depends on several factors, including the interest rate, mortgage term, and type of mortgage (e.g., fixed, variable, interest-only, or repayment). Here’s an overview of typical monthly repayments based on different terms and rates:
| Mortgage Term | Interest Rate | Monthly Repayment (Repayment Mortgage) | Monthly Repayment (Interest-Only) |
|---|---|---|---|
| 25 years | 4.5% | £5,556 | £3,750 |
| 25 years | 5.0% | £5,870 | £4,167 |
| 30 years | 4.5% | £5,067 | £3,750 |
| 30 years | 5.0% | £5,368 | £4,167 |
Note: These figures are estimates based on standard repayment and interest-only mortgages. Actual costs may vary depending on your lender, credit profile, and market conditions. For a personalised quote tailored to your financial situation, contact our expert mortgage brokers today to explore your options.
Use our million pound mortgage calculator to work out how much a £1 million pound mortgage will cost.
Key Factors Affecting Your Mortgage Costs
Several variables influence the cost of a £1 million mortgage. Understanding these can help you plan effectively:
- Interest Rates: Fixed-rate mortgages offer stability, while variable or tracker rates may fluctuate with the Bank of England’s base rate.
- Deposit Size: A larger deposit (e.g., 20-40%) reduces the loan-to-value (LTV) ratio, often securing lower interest rates. For high-value mortgages, lenders may require at least a 10-20% deposit.
- Mortgage Term: Longer terms (e.g. 30-35 years) reduce monthly payments but increase total interest paid. Shorter terms save on interest but require higher monthly repayments.
- Your Financial Profile: Lenders assess your income, credit score, and debt-to-income ratio. High-net-worth individuals or self-employed borrowers may need specialised mortgage products. Explore our high-net-worth mortgage services.
- Additional Fees: Arrangement fees, valuation fees, and legal costs can add thousands to the upfront cost. Our brokers can help you find lenders with competitive fee structures.
Interest-Only vs. Repayment Mortgages
- Repayment Mortgages: You pay both the interest and part of the capital each month, fully repaying the loan by the end of the term. This option is ideal for long-term ownership.
- Interest-Only Mortgages: You only pay the interest monthly, with the full £1 million due at the end of the term. This is popular for buy-to-let or investment properties but requires a clear repayment strategy.
Unsure which option suits you? Book a free consultation with Fox Davidson to discuss your goals and find the right mortgage product.
Additional Costs to Consider
Beyond monthly repayments, a £1 million mortgage comes with other expenses:
- Stamp Duty Land Tax (SDLT): For a £1.5 million property (assuming a 33% deposit), SDLT in England could exceed £90,000, depending on your buyer status (e.g., first-time buyer, additional property). Use our Stamp Duty Calculator to estimate costs.
- Legal and Survey Fees: Expect to pay £1,500–£3,000 for conveyancing and surveys, especially for high-value properties.
- Insurance: Buildings insurance is mandatory, and you may want to consider life or income protection insurance. Learn about mortgage protection options.
How Fox Davidson Can Help
Securing a £1 million mortgage requires expert guidance to navigate complex lender criteria and secure the best rates. At Fox Davidson, our experienced brokers:
- Compare thousands of mortgage products from high-street and specialist lenders.
- Offer tailored advice for high-net-worth individuals, self-employed borrowers, or buy-to-let investors.
- Handle the entire application process, saving you time and stress.
Get in touch today for a no-obligation consultation to discuss your £1 million mortgage needs.
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Fox Davidson are a specialist UK mortgage broker. We work with international and UK resident clients to secure funding on residential & commercial property in the UK. We can work by phone, email and video call. We have London & South West offices at which we can meet clients.
FAQs:
Lenders will typically require at least a 10% deposit for a million pound property. Bespoke lending terms from private banks may go higher.
Certain mortgage lenders will accept income paid in a foreign currency. This includes US dollars, Euros, UAE Dirhams and Swiss Francs, among others. When assessing affordability lenders will factor in a currency fluctuation haircut of up to 25%.
£1 million offset mortgages allow you to offset savings held in a linked savings account.
A mortgage is a loan secured against your home or property. Your home or property may be repossessed if you do not keep up repayments on your mortgage or any other debt secured on it.
