Linear Mortgage Calculator — Fixed Principal Repayment

Loan amount

Annual interest rate

Loan term

Results

First month payment
—

Last month payment
—

Total interest paid

—

Monthly principal

—

fixed every month

Annual payment schedule

Year	Start payment	End payment	Principal paid	Interest paid	Balance

About the Linear Mortgage Calculator

What is a linear mortgage?

A linear (or straight-line) mortgage has a fixed principal repayment each month, but the total monthly payment decreases over time as the outstanding balance falls and less interest accrues.

Linear vs annuity

With an annuity mortgage, the monthly payment stays the same throughout the term. With a linear mortgage, payments start higher but fall steadily — meaning you pay less total interest overall.

First payment — highest, because the full balance is outstanding and interest is at its peak
Last payment — lowest, because the balance is nearly cleared
Total interest — generally lower than an equivalent annuity mortgage

Overpaying on an annuity mortgage

If you cannot switch to a linear mortgage, making regular overpayments on an annuity mortgage achieves a similar effect: each overpayment reduces the principal, which reduces future interest charges and shortens the term. Most UK lenders allow overpayments of up to 10% of the outstanding balance per year without triggering early repayment charges.

10% annual overpayment allowance — most fixed-rate mortgages permit this without penalty
Effect of overpaying — a £200/month overpayment on a 25-year £200,000 mortgage saves approximately £20,000 in interest and 4 years off the term
Offset mortgages — link savings to the mortgage; interest is calculated on balance minus savings, effectively overpaying without losing liquidity
Tracker vs fixed — overpayment limits vary; tracker mortgages sometimes allow unlimited overpayments

Frequently Asked Questions

What is a linear mortgage?

With a linear mortgage, you repay the same fixed amount of principal every month. Because the outstanding balance shrinks faster, the interest portion decreases each month — meaning your total monthly payment goes down over time.

Is a linear mortgage cheaper than annuity?

Yes — you pay less total interest with a linear mortgage because you reduce the principal balance faster. However, the initial monthly payments are higher, which may affect affordability. Use our comparison tool to see the exact difference for your loan.

How does a linear mortgage differ from an annuity mortgage?

With a linear mortgage, you repay the same amount of principal each month, so the total monthly payment decreases over time as the interest portion shrinks. With an annuity mortgage, the monthly payment stays constant — early payments are mostly interest and later payments are mostly principal.

Is a linear mortgage better than an annuity mortgage?

A linear mortgage costs less in total interest because you pay down the principal faster in the early years. However, the higher initial payments mean you need a higher income to qualify. An annuity mortgage has lower initial payments, making it more accessible for first-time buyers.

When does the linear mortgage payment stop decreasing?

The monthly payment decreases gradually every month as the interest portion shrinks. By the final months of the loan, your payment will be approximately just the fixed principal instalment plus minimal interest.