Most UK lenders will offer somewhere around 4 to 4.5 times your gross annual income, sometimes more, but the final figure depends on your debts, spending, credit record and the deposit you have. On a single income of £55,000 with no debts, 4.5 times income is £247,500. Use that as a rough starting point, not a promise.
How lenders decide how much to lend
Lenders look at two broad questions: how much you earn, and whether you could keep paying if things changed. The main factors are:
- Income. Your basic salary counts most. Bonuses, overtime and self-employed profits may be counted in part or in full, depending on the lender.
- Existing debts. Credit cards, loans, car finance and other commitments reduce what you can borrow.
- Regular spending. Lenders assess your outgoings, not just your debts.
- Credit record. A poor record can reduce the amount offered or the deals available.
- Stress testing. Lenders check whether you could still afford payments if interest rates were higher.
Because every lender weighs these differently, the same person can get different offers from different lenders.
The income multiple rule of thumb
The quickest estimate is income multiplied by 4 to 4.5. With two applicants, you add both incomes together. The House of Calculator affordability tool lets you choose the multiple, add a second income and subtract your monthly debts.
For example, with £55,000 income, a multiple of 4.5 and a £40,000 deposit, the tool gives:
| Scenario | You could borrow about | Home price with deposit |
|---|---|---|
| No monthly debts | £247,500 | £287,500 |
| £150 a month of debts | £220,513 | £260,513 |
The £150 monthly debt cuts the estimate by about £26,987. Paying off a loan or card before applying can therefore raise what you can borrow.
Deposit, loan-to-value and price
Your deposit works alongside the amount you borrow. Borrowing £220,513 with a £40,000 deposit gives a home price of about £260,513, with the deposit at roughly 15.4% of the price. A bigger deposit means a lower loan-to-value, which can open up cheaper deals, though rates change often so check what lenders currently offer.
Think of the deposit as a savings project. If you are still building one, How long to reach a savings goal shows how long a target takes.
Beyond the loan: what else you will pay
Borrowing capacity is not the same as what is comfortable. Budget for:
- Stamp Duty, LBTT or Land Transaction Tax, depending on where the home is. See Stamp Duty, LBTT and LTT explained.
- Legal, survey and valuation fees, and moving costs.
- Running costs such as insurance, repairs and bills.
It also helps to test the monthly payment at a higher rate than today’s. For a £250,000 loan over 25 years, 4.5% gives £1,389.58 a month, while 5.5% gives £1,535.22. The workings are in How mortgage repayments are calculated.
Ways to improve your borrowing power
- Clear or reduce existing debts and avoid new credit before applying.
- Check your credit report and correct errors.
- Save a larger deposit.
- Consider a joint application, if appropriate.
- Talk to a mortgage broker, who can compare lenders’ criteria.
A simple checklist before you apply
Before approaching a lender or broker, gather the basics so your estimate is realistic:
- Your last few payslips and P60, or tax returns if self-employed.
- A list of all monthly commitments, including credit cards and subscriptions.
- Proof of your deposit and where it came from.
- A rough idea of the area and price range you are considering.
Running the numbers in advance also shows you how much room there is in your budget, so a lender’s offer does not come as a surprise. If the figure is lower than you hoped, you can adjust the deposit, the debts or the price target and see the effect straight away.
Note: This is general information, not financial advice. The tool gives rough estimates; only a lender can confirm what you can borrow. Your home may be repossessed if you do not keep up repayments on a mortgage.
Try the calculator
Put your income, debts and deposit into the Mortgage affordability to see a ballpark borrowing figure. Then use the Mortgage calculator to check the monthly repayment at different rates.
Open the free Mortgage affordability
Worked example 2: a couple on two incomes
Lenders add joint incomes together, so a second applicant can change the picture a lot. Suppose one person earns £40,000 and the other £32,000, with no monthly debts, a £30,000 deposit, and an illustrative rate of 5% over 25 years. The House of Calculator affordability tool gives:
| Lender multiple | Could borrow about | Home price with deposit | Estimated monthly repayment |
|---|---|---|---|
| 4 times income | £288,000 | £318,000 | £1,683.62 |
| 4.5 times income | £324,000 | £354,000 | £1,894.07 |
| 5 times income | £360,000 | £390,000 | £2,104.52 |
The gap between 4 and 5 times income is £72,000 of borrowing, which shows why comparing lenders matters. It also shows the cost of stretching: the higher multiple adds about £420 to the monthly payment.
Now add £300 a month of debts, such as a car loan and a credit card, at the 4.5 times multiple. The estimate falls to £272,682, a reduction of £51,318. A debt of £300 a month therefore removes much more than its annual cost from your borrowing, which is why clearing debts before applying can be worth more than a bigger deposit.
Affordability checks beyond the multiple
Many lenders now rely less on a simple income multiple and more on a full affordability assessment. In general they will look at:
- Committed spending: loan and card repayments, childcare, maintenance payments and similar fixed costs.
- Essential spending: food, transport, utilities and insurance, estimated from what you declare or from statistical models.
- Rate stress test: whether you could still pay if the rate rose by a set margin, which varies between lenders.
- Age and term: an older applicant may be offered a shorter term, which raises the monthly payment and may reduce the amount lent.
- Employment type: permanent, contract, self-employed and zero-hours income are treated differently, and self-employed applicants usually need to show two or three years of figures.
Because these rules vary, the multiple is a first estimate rather than a ceiling or a floor. Many lenders also place their own cap on the proportion of loans they will make at very high multiples.
Step-by-step: how to estimate your own figure
- Add up gross annual income for everyone on the application. Use the basic salary first, and only add bonuses or overtime if you can evidence them over a long enough period.
- Multiply by 4, 4.5 and 5 to see a range rather than one number.
- Subtract the effect of debts. Clear the ones you can, and list those you cannot. The tool does this for you if you enter your monthly total.
- Add your deposit to see the property price you could target.
- Check the monthly payment at the current rate and at a higher one. Our How mortgage repayments are calculated guide shows how the payment is worked out.
- Compare with your real budget. Take your actual take-home pay, subtract what you spend now, and see whether the payment leaves a margin. How to work out your take-home pay from a UK salary helps with the first figure.
Different situations
First-time buyers. Often the deposit is the real limit, not the income multiple. The extra costs of buying, including tax, legal fees and moving, can take a noticeable bite of savings, so keep a buffer.
Self-employed or contractors. Lenders usually want to see tax returns or accountant-certified figures. Profits after tax and expenses may count rather than turnover, so a good year on paper may borrow less than expected.
Existing homeowners moving up. The equity in your current home acts as your deposit. Estimate the sale price, subtract your outstanding mortgage and costs of selling, and use the remainder.
Student loans. A student loan repayment comes out of your pay before you receive it and lenders take it into account, so it may reduce what you can borrow. See Student loan repayments explained: plans, thresholds and what you'll pay for how the repayments work.
Common mistakes to avoid
- Using the maximum figure as a target price. The maximum is what a lender might offer, not what suits your budget.
- Ignoring small commitments. Several subscriptions, a buy-now-pay-later balance or a store card can add up in an assessment.
- Taking on new credit shortly before applying, which can lower your score and your borrowing.
- Forgetting that interest rates change. Check you could cope if the payment rose.
- Applying to many lenders in a hurry, which can leave several searches on your credit file. A broker can often sort this out with a single enquiry.
When to check with a professional
An online tool cannot see your credit file or a lender’s current criteria. Before making an offer on a property, get an agreement in principle from a lender, or speak to a regulated mortgage broker who can compare criteria across the market. The rules on affordability are set by the Financial Conduct Authority and lenders apply them in their own way, so ask what a lender’s policy is rather than assuming.
Frequently asked questions
How many times my salary can I borrow?
Many lenders offer around 4 to 4.5 times annual income, and some will go higher in certain circumstances. The exact multiple depends on your circumstances and the lender’s policy.
Do monthly debts reduce my mortgage?
Yes. Loans, credit cards and finance payments reduce the amount lenders will offer. In our example, £150 a month of debts lowered the estimate by about £26,987.
Do both incomes count on a joint mortgage?
Generally, yes. Lenders add the incomes of joint applicants together, although they also consider both people’s debts and credit records.
Is the amount I can borrow the amount I should borrow?
Not necessarily. A lender’s maximum may leave little room for other costs, so work out what monthly payment you would be comfortable with.
Can I get a mortgage on a low deposit?
Often yes, but a smaller deposit usually means fewer deals and higher rates. Lenders set the minimum deposit they accept, so check with a broker or lender what is currently available.
Does my credit score affect how much I can borrow?
It can. A weaker record may reduce the amount offered, limit the lenders available or raise the rate. Check your credit report with the main reference agencies and correct any errors before you apply.
How long does a mortgage agreement in principle last?
It varies by lender, often around 60 to 90 days, but check the paperwork. It is not a binding offer and it can be withdrawn after a full application is assessed.
Do bonuses and overtime count towards my income?
Sometimes. Some lenders count only part of variable pay and ask for a history of receiving it. Ask your lender or broker how they treat yours.