While every lender is different, understanding the factors that affect your borrowing can help you set a realistic budget and start your property search with confidence.
What affects how much you can borrow?
It's not just about your salary. Lenders will also look at things like:
- Your income
- Your monthly outgoings
- Your credit history
- The size of your deposit
- Your employment status
They'll use this information to work out what you can comfortably afford to repay.
How much could I borrow?
As a general guide, many lenders may offer around 4 to 4.5 times your annual income, although this varies depending on your personal circumstances.
| Annual Income | Approximate Borrowing |
|---|---|
| £30,000 | £120,000–£135,000 |
| £40,000 | £160,000–£180,000 |
| £50,000 | £200,000–£225,000 |
| £60,000 | £240,000–£270,000 |
| £75,000 | £300,000–£337,500 |
| £100,000 | £400,000–£450,000 |
*These figures are illustrative only and don't guarantee how much you'll be able to borrow.
Don't forget the bigger picture
While it's helpful to know the maximum you could borrow, that doesn't always mean it's the right amount for you.
Think about the other costs that come with buying a home too, including:
- Stamp Duty (where applicable)
- Solicitor and conveyancing fees
- Survey costs
- Removal expenses
- Home insurance
- Monthly household bills
Choosing a mortgage that's comfortable for your budget can give you greater peace of mind both now and in the future.
Ready to find out what you could borrow?
A mortgage adviser can give you a personalised affordability assessment based on your income, outgoings, and financial circumstances, helping you understand exactly what's within your budget.
Take the next step with a Mortgage in Principle
Once you have a better idea of how much you could borrow, the next step is to consider getting a Mortgage in Principle (also known as an Agreement in Principle or Decision in Principle).
A Mortgage in Principle is an indication from a lender of how much they may be willing to lend you, based on the information you provide. While it isn't a formal mortgage offer, it can give you greater confidence when viewing properties and show estate agents and sellers that you're a serious buyer.
Having a Mortgage in Principle can also help speed up the buying process once you've found the right home, as you've already taken the first step towards securing your mortgage.
At Reeds Rains, our partners at Embrace Financial Services can help you arrange a Mortgage in Principle and explain your borrowing options. They'll search from a wide range of lenders to help find a mortgage that's suitable for your individual circumstances and support you throughout your home-buying journey.
If you're ready to start house hunting, speak to your local Reeds Rains branch to arrange an appointment with an Embrace Financial Services adviser and take the next step with confidence.
Your home may be repossessed if you do not keep up repayments on your mortgage.
Your initial mortgage appointment is without obligation. Embrace Financial Services normally charge a fee for their services; however, it is payable only on the submission of your mortgage application. The fee will depend on your circumstances, but the standard fee is £599. Complex cases usually attract a higher fee. Embrace Financial Services will discuss and agree the fee with you prior to submitting any mortgage application.
Reeds Rains is an introducer to Embrace Financial Services Ltd. Embrace Financial Services Ltd is an Appointed Representative of PRIMIS Mortgage Network, a trading name of First Complete Ltd. First Complete Ltd is authorised and regulated by the Financial Conduct Authority.
You are under no obligation to use our recommended mortgage or protection adviser. Your decision will not affect the seller’s decision, the acceptance of your offer, or the progress of your purchase.
The Reeds Rains Content Marketing Team
