Chat with us, powered by LiveChat Q: How much mortgage can I get? - London Mortgage Partners

How much mortgage can I get? The most popular question a mortgage broker is asked.

Multiple factors impact exactly how much you can borrow on your mortgage, such as your income, level of deposit, your occupation, length of mortgage term, credit history and amount of debts amongst others.

For most, the three main factors are your income, level of debt and the amount of deposit you have.

We’ll start with income.

Your income is the main driving factor in how much you can borrow. Lenders will use your income to assess affordability by establishing your disposable income against your liabilities and general cost of living. This will then determine how much you can afford for a monthly payment and once assessed against the lenders ‘affordability stress test’, will determine the amount you can borrow. Generally the longer the duration (‘term’) of your mortgage and lower the payment, the more you could borrow.

Outstanding Debts can have a large impact upon how much you’re able to borrow. Lenders have a ‘tolerance’ built in for debts, so often we find that small balances on a credit card for example may not impact affordability or a small car/loan payment. However, when multiple people have multiple debts the amount in which you can borrow can be significantly reduced. All lenders tolerances are different and dependent on your income will change the leeway you have on commitments.

Lastly, Deposit.

Your deposit can have an impact on how much a lender is willing to lend to you. It is a scenario of ‘the more you give, the more you get’. This is because lenders find comfort the larger your deposit is by increasing the security you are providing to them. A standard ‘income multiple’ is usually around 4.5x your income. However this can increase to 5x, 5.5x or even 6x depending on deposit size and the lenders individual criteria. Other factors can impact this multiple such as your occupation, credit & income.

To find out more about how much you may be able to borrow, contact us today to speak with a member on the team.