How Much Can You Afford to Borrow?
Work out how much mortgage you can get. We explain affordability checks, income multiples, and what lenders actually look at when deciding how much to lend you.
Quick Answer
Most UK mortgage lenders will lend 4 to 4.5 times your annual income. So if you earn £40,000, you could borrow around £160,000-£180,000. But affordability checks also consider your outgoings, debts, and the interest rate — so your actual limit may be higher or lower.
How lenders decide what you can borrow
Gone are the days of simple income multiples. Since 2014, lenders must run detailed affordability assessments. They're not just asking "how much do you earn?" — they're asking "can you actually afford the repayments?"
What they check
- Your income — Salary, bonuses, self-employment income, other regular income
- Your outgoings — Bills, subscriptions, childcare, debt repayments
- Your credit history — Missed payments, defaults, debt levels
- The property — Type, condition, lease length (for flats)
- Interest rate stress test — Can you afford repayments if rates rise?
Lenders must "stress test" your affordability at a higher interest rate than you'll actually pay. This protects you (and them) if rates rise in future.
The income multiple rule
The starting point is usually 4-4.5x your salary:
| Annual income | Typical borrowing range |
|---|---|
| £30,000 | £120,000-£135,000 |
| £40,000 | £160,000-£180,000 |
| £50,000 | £200,000-£225,000 |
| £60,000 | £240,000-£270,000 |
| £80,000 | £320,000-£360,000 |
| £100,000 | £400,000-£450,000 |
Joint applicants: If buying with a partner, both incomes count. Combined income of £70,000 could mean borrowing up to £315,000.
When you might get more
Some lenders offer higher multiples (up to 5.5x) if:
- You're in a professional occupation (doctor, lawyer, accountant)
- You have a large deposit (25%+)
- You have minimal other debts
- Your income is likely to grow significantly
When you might get less
Your borrowing might be capped lower if:
- You have significant debts (car finance, loans, credit cards)
- You have dependents
- You're near retirement age
- You have irregular income
- The property is unusual (ex-local authority, non-standard construction)
What counts as income?
Definitely counted
- Basic salary — 100% counted
- Guaranteed bonuses — Usually 100% counted
- Regular overtime — Often 50-100%, must show history
Sometimes counted
- Commission — Usually averaged over 1-2 years
- Discretionary bonuses — Often 50%, averaged over years
- Rental income — If you own other property
- Investment income — Dividends, interest
- Second jobs — If stable history
Special cases
Self-employed: Lenders typically want 2-3 years of accounts. They'll use your average net profit or salary + dividends.
Contractors: Some lenders calculate on day rate × 5 days × 48 weeks. Others want to see contract history.
If you're self-employed or have complex income, use a mortgage broker. They know which lenders are most flexible with different income types.
What outgoings do they count?
Lenders will ask about your regular monthly spending:
Fixed commitments
- Loan repayments
- Credit card minimum payments
- Car finance
- Child maintenance
- Student loan (affects affordability threshold)
- Existing mortgage/rent
Living costs
Lenders use their own estimates for these, but may ask about:
- Childcare costs
- School fees
- Ground rent and service charges
What doesn't count against you
- Rent payments (these will stop when you buy)
- Savings contributions
- Discretionary spending (you could cut back)
The stress test explained
Since 2022, lenders stress test at their standard variable rate + 1%, or a minimum of around 5.5-7%. This means proving you could afford payments if rates increased.
Example:
- Mortgage: £250,000
- Actual rate: 4.5%
- Monthly payment at 4.5%: £1,389
- Stress test rate: 7%
- Monthly payment at 7%: £1,767
The lender needs to be confident you could manage £1,767/month, even though you'll actually pay £1,389.
This stress test is why you might be approved for less than the income multiple suggests. A couple earning £80,000 might only be approved for £280,000 if they have high childcare costs or car finance.
How to maximise your borrowing
If you want to borrow more, address these factors before applying:
1. Reduce debts
Pay off credit cards, personal loans, and car finance if possible. Every £100/month of debt could reduce your borrowing by £15,000-£20,000.
2. Clean up your credit file
- Pay all bills on time for 6+ months
- Don't apply for new credit
- Register on the electoral roll
- Fix any errors on your credit report
3. Reduce discretionary spending
In the 3 months before applying, cut back on takeaways, gambling, and excessive spending. Lenders review your bank statements.
4. Consider a longer term
A 35-year mortgage has lower monthly payments than a 25-year one. This might help affordability (though you'll pay more interest overall).
5. Use a broker
A good broker knows which lenders are more generous with different income types or circumstances.
How this works in practice
Case study: Sarah and James
- Combined income: £70,000
- Deposit saved: £45,000
- Monthly debts: Car finance £280
Without car finance:
- Potential borrowing: £315,000
- With £45k deposit: Could buy up to £360,000
With car finance:
- Potential borrowing: £255,000
- With £45k deposit: Could buy up to £300,000
The car finance costs them £60,000 of borrowing power.
Agreement in Principle
Before house hunting seriously, get an Agreement in Principle (AIP). This:
- Confirms roughly what you can borrow
- Shows sellers you're a credible buyer
- Takes a few hours to arrange
- Involves a soft credit check (doesn't affect your score)
The actual approved amount may differ when you fully apply, but an AIP gives you a realistic budget to work with.
What Really helps with
Once you know your budget, Really helps you find the right property:
- Search within your budget — Filter by price range
- See actual sold prices — Understand if properties are fairly priced
- Compare value across areas — Your budget goes further in some locations
- Track properties — Save and compare options
Start searching in your price range