How much can I borrow
If you’re wondering ‘how much can I borrow?’, you can consult our mortgage calculator for a quick indication.
And not only that, but when you’ve finished your financial self-assessment, we provide access to free mortgage advice from an expert whole-of-market advisor who will search the entire market for a mortgage deal that perfectly suits your financial circumstances and personal goals.
How much mortgage can I afford to borrow?
The amount that can be borrowed is, of course, always at the lender’s discretion, and they will decide how much they want to essentially risk giving you based on your finances and credit history. But there are rough guidelines.
Ask our mortgage calculator how much can I borrow? Input your details and requirements and you’ll get an idea of how much you’d need to borrow for the property you want to buy. You’ll then have this information to hand when you’re asked to go through your financials with a mortgage lender whenever you decide to talk to one.
What do people usually borrow?
The typical amount lent for a mortgage can be approximately three and a half times the principle earner’s annual income (before tax), plus the sum of one year’s salary for any secondary earner.
However, if a larger amount is reached by combining the incomes and increasing it two-and-a-half, this alternative method of calculating the mortgage will be reached.
It’s always important to remember, however, that one lender’s rules may differ greatly from the next, and that these figures are only a guideline. Some lenders, for example, now look at affordability measures that take into account other circumstances that are likely to have an impact such as other debts, financial commitments or whether the borrower has any dependents.
Are there any other things I need to think about?
In short, yes. Interest rates can and do rise, so avoid borrowing right up to the limit of how much you can feasibly afford to repay each month, otherwise you’re likely to soon end up lumbered with a mortgage that you simply can’t afford to repay, plus you’ll be truly stuck if any household emergencies occur (e.g. replacing the roof, buying a new boiler etc.).
Work out your household income, then subtract your outgoings, including absolutely everything from groceries to bus tickets, petrol, utilities, clothes, holidays, and everything in between.
Of course, you can omit any payments that would be discontinued if you owned your own home (e.g. rent) but be sure to include any new costs (e.g. travel costs, insurance etc.).