Rates Guide
How to compare the cost of different mortgages
Written and reviewed by Sophie Harrison · Page last reviewed 20 August 2026
The cheapest-looking mortgage often isn't the cheapest mortgage. We show six different ways to measure cost on every rate — here's what each one means, which to trust, and how the balance you'd still owe factors into the ranking.
Lenders compete hardest on the headline interest rate, so the top of a best-buy table has often been a low rate propped up by a large fee. That's less common than it used to be — since the FCA's Consumer Duty came into force, lenders must show their products offer fair value, which has curbed the most heavily fee-loaded pricing. Even so, the trade-off between rate and fee hasn't gone away, and whether a deal actually saves you money still depends on your loan size, how long the deal lasts, and what you pay upfront.
That's why we show six different ways to measure cost on the rates pages, and sort by the one we believe is fairest. This guide explains what each number means, which one to trust, and the situations where a different one deserves your attention.
The six numbers, explained
Rate
The interest rate you'll pay during the deal — the first 2, 3 or 5 years, before it reverts to the lender's standard variable rate. It's the number in every advert, and alone it can mislead: a 4.5% deal with a £1,999 fee can easily cost more than a 4.7% deal with no fee.
Monthly payment
What leaves your account each month during the deal. The number to watch for your household budget — but it ignores upfront fees entirely, so it can flatter a deal that charges heavily on day one.
Cost over product term
Every monthly payment, plus the product fee, plus standard costs like valuation and legal work where the lender doesn't cover them — added up across the deal period. One number, covering the whole time the deal actually lasts.
Cost over full term
The same idea stretched across the entire mortgage — 30 years, say — including the years after your deal ends on the lender's standard variable rate. Treat it with caution: it assumes you never remortgage, and most people switch the moment their deal ends.
Fees
Just the upfront cost of taking the deal. Useful when spare cash at the start is the constraint. Many lenders let you add the fee to the loan instead — but then you pay interest on it for the life of the mortgage, which raises the overall cost, not lowers it.
APRC
A single percentage every lender must publish, blending rate and fees across the full life of the mortgage. Useful for roughly comparing wildly different products — but like cost over full term, it assumes you keep the mortgage forever, so it says little about the deal you're actually choosing between.
Which number should I use?
Follow the first question that applies to you:
Is keeping your monthly outgoings down what matters most — even if the deal costs more overall?
Sort by Monthly payment.
Is upfront cash the squeeze — you need to spend as little as possible on day one?
Sort by Fees. Be wary of adding the fee to the loan: it quietly raises the lifetime cost.
Likely to keep this mortgage to the very end without ever switching — only a few years left, or a balance too small for remortgaging fees to make sense?
Look at Cost over full term, and glance at the APRC.
Everyone else — which is most people:
Sort by Cost over product term. It's our default, and the fairest like-for-like comparison of what a deal will really cost you.
Rate is still worth a glance — it's the quickest way to scan the market, and if two deals share the same fee, the lower rate simply wins. It's just a poor way to rank deals that charge different fees.
Why our default is cost over product term
Because it answers the question you're actually asking: what will this deal cost me while I'm on it?
Adding up everything you'd pay during the deal itself — payments, product fee and standard charges — puts a low-rate deal with a big fee and a higher-rate deal with no fee on the same footing. You just see which one leaves more money in your pocket over the years the deal actually runs.
A worked example
£200,000 over 25 years, comparing two fixes that each last 2 years:
Deal A
- Rate
- 4.5%
- Product fee
- £1,999
- Monthly payment
- £1,112
- Total cost over 2 years
- £28,679
Deal B
- Rate
- 4.8%
- Product fee
- £0
- Monthly payment
- £1,146
- Total cost over 2 years
- £27,504
Deal A wins on rate and on monthly payment, but works out about £1,175 more over the deal period, because of the fee. Sorting by cost over product term is the only view where Deal B correctly rises to the top. The bigger the fee relative to the loan, the starker this gets.
What you'll still owe — and why it's part of the ranking
All six figures above measure what leaves your pocket. None of them show what's left in the mortgage — the balance still outstanding when the deal ends. That balance doesn't vanish. You still owe it, and it carries straight into your next remortgage.
On a repayment mortgage, every monthly payment splits between interest and capital, and the rate decides that split: a lower rate sends more of each payment toward paying down the loan, a higher rate sends more of it to the lender as interest. Two deals can cost the same overall and still leave you owing different amounts, because they paid down different amounts of capital along the way.
Above the waterline — what these figures show you
Below the waterline — the balance still owed when the deal ends
Bars on this row are zoomed to a £190,000–£191,500 window so the ~£370 gap is visible — both deals owe roughly £190k. On the true £0–£220k scale used above, the difference would vanish.
Deal A's lower rate meant more of each £1,112 payment reduced the balance, so it finished the two years owing roughly £370 less than Deal B. That's real money — it isn't sitting in Deal A's mortgage waiting to be paid off later. But Deal B's £1,175 saving on cost over product term is still bigger, so Deal B leaves you better off overall — by roughly £800, not the full £1,175 the headline cost figures alone suggest.
The bigger the rate gap and the fewer years you're comparing, the more this matters — which is why sorting by cost over product term or cost over full term now weighs the balance automatically, not just the number at the top of the table. You'll see it as a smaller line under each deal's cost figure, so you can see exactly what's driving the order.
It isn't only the rate that drives this — how a deal structures its fee does too. A no-fee deal typically carries a higher rate to compensate, which, as above, pays down less capital. And if you choose to add the fee to the loan rather than pay it upfront, that fee doesn't disappear from the balance — it becomes part of it, plus the interest it accrues, so you're left owing more at the end than a like-for-like deal where the fee was paid upfront. Because the balance is folded into the ranking, a deal can no longer quietly look cheaper on cost over product term while leaving you with more still owed — the line under its cost figure will show it.
Interest-only is a different, starker version of this. None of your payment reduces the balance regardless of rate or fee — you owe the full amount you borrowed for as long as the mortgage runs, unless you're repaying capital through a separate vehicle. That's why an interest-only deal's balance line will show close to the full amount you borrowed on every row — it's not a red flag on any one deal, it's just what interest-only means, made visible.
Want a single figure that already includes the remaining balance? Our Fee vs Rate calculator folds it into its "true total cost" for you.
The small print on how we calculate cost
What counts
We include every monthly payment during the period, the product fee, and standard charges such as valuation and legal costs, unless the deal genuinely covers them (free valuation, free legals) — in which case we don't charge them to that deal.
Cashback is shown, never subtracted
Some deals offer a few hundred pounds back at completion. We show it, but we don't let it shrink the cost figure, so a deal can't buy its way up the table with a headline sweetener.
Adding the fee to the loan
This changes the comparison honestly: the fee stops being an upfront cost and becomes extra borrowing, and the cost figures reflect the interest you'll pay on it.
Ready to compare live rates?
Browse today's deals, sorted by cost over product term by default.
