How Much Can I Borrow: Mortgage Calculator

Mortgage Calculator

If you’re hoping to take out a mortgage, our mortgage calculator will give you a rough idea of ​​how much a lender might offer you based on your income and if you’re buying with someone else.

How do lenders decide how much I can borrow?

Your salary will have a big impact on how much you can borrow for a mortgage.

Usually, banks and building societies will offer up to four and a half times the annual income of you and anyone you shop with. This means that if you buy on your own and earn £30,000 a year, you could be offered up to £135,000.

There are, however, exceptions to this. Some banks offer larger home loans to borrowers who have higher incomes, larger deposits, or work in specific professions. If you qualify, you may be able to borrow up to five and a half times your income.

What other factors affect how much I can borrow?

Monthly expenses

Lenders will want to know how you are spending your money as part of an affordability assessment. You are likely to ask questions about:

  • Debt payments (for example, student loans and credit card bills)
  • Regular bills (e.g. gas and electricity)
  • Transport costs
  • Grocery fees
  • Leisure expenditures

Your lender may also ask for recent bank statements and payslips to support your claim.

Read our guide to saving for a mortgage to learn more about reducing outgoing costs.

Interest rate

Interest rates play a key role in how much you could borrow.

In most cases, lenders will stress test any proposed mortgage repayment plan to ensure that you can withstand an interest rate hike of at least three percentage points. The Bank of England is consulting on scrapping this requirement, although changes are unlikely to come into force before 2023.

Use our Mortgage Interest Rate Rise Calculator to see how your mortgage payments would be affected if your interest rate increased.

If you have a fixed rate mortgage, interest rate increases will only affect you at the end of your fixed rate period. But with an adjustable rate mortgage, your interest rate can go up or down at any time during your term.

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