How Much Can You Borrow For £1,000 Per Month
What you can borrow with £1,000 per month depends on your interest rate, mortgage term, and whether you choose an interest-only or repayment mortgage. Our 15 experts can review your situation and get creative to give the best advice for you. We are confident we can get your mortgage approved and find you the best deal. If we cannot and another broker does, we will give you £100.*
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Author: Pete Mugleston
CeMAP Mortgage Advisor, MD
Reviewed by: Jon Nixon
Former Director of Distribution
Quick Summary
What you can borrow and which property values you can afford with £1,000 a month will depend on a few factors, mostly:
- The rate you qualify for (based on your deposit / equity and Loan-To-Value, and wider lending criteria like credit history etc)
- The term you borrow over (35-year terms are less per month than 25-year terms, but you pay more interest overall)
- If you can get any on interest-only (not repaying the capital, just the interest, means its less per month but you still need to repay the mortgage at the end – great for investors or those who have other plans to repay)
For example, for £1000 a month, you could get approximately £225,000 on a 4.09% rate over a 35 year term, but this reduces to approximately £190,000 over 25 years. If you took the same rate on interest-only is more like £290,000 max loan (bear in mind lenders have strict policy about this and some limit the loan to value to 50%, for instance – so speak to an expert to find out!).
The type of mortgage you can get is not determined by how much you want your monthly repayment to be; rather, it is based on a lender’s affordability assessment. After affordability has been calculated, as long as you meet the additional eligibility criteria, you could secure:
- a traditional repayment mortgage,
- an interest-only mortgage
- a commercial mortgage
- a buy-to-let mortgage
Different types of mortgages attract different terms and conditions that vary from lender to lender. So, your ability to borrow will depend on your annual income and expenses, as well as the income multiple a lender applies.
If you get a fixed-rate mortgage, you’ll be committed to an interest rate for the agreed amount of time. However, if you are on a variable mortgage, your monthly payments will change regularly depending upon the changes to the base rate made by the Bank of England.
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How affordability is calculated
Mortgage providers use income multiples rather than a set monthly budget, whether for £1,000 or any other amount, to determine the maximum amount they will extend to you as part of their affordability calculations.
Usually, lenders will lend between 4 and 4.5 times a household’s annual income. However, some lenders are happy to increase even to 6 times your annual income.
Strong applications, high deposits, good credit histories, and strong income levels will find that applicants are more likely to be eligible with mortgage lenders who use higher income multiples.
That’s not to say that all lenders will always loan at least 4 times a household’s income. Lenders want to know that what they extend is affordable to you regarding monthly repayments.
If you have large amounts of outgoings each month (school fees, car loan repayments, etc), providers may calculate you can only afford an amount lower than a 4-time income multiple. Plus, they will want to apply a stress test to ensure you can afford any future interest rate increases.
To find out how this may work out for yourself, take a look at our mortgage affordability calculator and input your own income:
Mortgage Affordability Calculator
Use this calculator to determine how much you could potentially borrow for a mortgage, based on the typical salary multiples used by most UK lenders.
Based on your total household income, you could borrow up to:
*
4.5x income
This is what most lenders would consider letting you borrow
5x income
Some lenders would consider letting you borrow this amount
6x income
Very few lenders would consider letting you borrow this amount
*To get exact numbers based on your specific income, outgoings, age and other info, you'll need to speak to one of our experts. Lending policies change regularly, so this is purely for illustrative purposes only, and is not tailored financial advice.
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How much mortgage can you get for approximately £1,000 per month?
Below are some hypothetical examples, based on a 10% deposit and a 25-year term, using different interest rates, with slightly varying monthly repayments, including £1,000 to £1,200 per month. Remember, other factors will affect how much you can borrow. These figures should be seen as a guide
£900 a month
At £900 per month and an interest rate between 4% and 6%, the potential loan amount could be between £139,700 and £170,500.
| Monthly Repayment | Interest rate | Deposit | Term Length | Potential mortgage amount |
|---|---|---|---|---|
| £900 | 4% | 10% | 25 years | £170,500 |
| £900 | 4.5% | 10% | 25 years | £162,000 |
| £900 | 5% | 10% | 25 years | £154,000 |
| £900 | 5.5% | 10% | 25 years | £146,500 |
| £900 | 6.00% | 10% | 25 years | £139,700 |
£1,000 a month
At £1,000 per month, the potential borrowing amount could range between £155,200 to £189,500.
| Monthly Repayment | Interest rate | Deposit | Term Length | Potential |
|---|---|---|---|---|
| £1,000 | 4% | 10% | 25 years | £189,500 |
| £1,000 | 4.5% | 10% | 25 years | £180,000 |
| £1,000 | 5% | 10% | 25 years | £171,000 |
| £1,000 | 5.5% | 10% | 25 years | £162,800 |
| £1,000 | 6% | 10% | 25 years | £155,200 |
£1,100 a month
For £1,100 per month, the potential borrowing range could be between £170,800 to £208,400
| Monthly Repayment | Interest rate | Deposit | Term Length | Potential mortgage amount |
|---|---|---|---|---|
| £1,100 | 4% | 10% | 25 years | £208,400 |
| £1,100 | 4.5% | 10% | 25 years | £197,950 |
| £1,100 | 5% | 10% | 25 years | £188,200 |
| £1,100 | 5.5% | 10% | 25 years | £179,100 |
| £1,100 | 6.00% | 10% | 25 years | £170,800 |
£1,200 per month
A mortgage for £1,200 per month could allow for a mortgage loan amount to range between £186,300 to £227,300.
| Monthly Repayment | Interest rate | Deposit | Term Length | Potential mortgage amount |
|---|---|---|---|---|
| £1,200 | 4.00% | 10% | 25 years | £227,300 |
| £1,200 | 4.50% | 10% | 25 years | £215,900 |
| £1,200 | 5% | 10% | 25 years | £205,300 |
| £1,200 | 5.50% | 10% | 25 years | £195,400 |
| £1,200 | 6.00% | 10% | 25 years | £186,300 |
If you want to calculate yourself, you can also use the mortgage repayment calculator below which will tell you how much your monthly mortgage would be based on the interest rate, loan amount and mortgage term.
Mortgage Repayment Calculator
This calculator can tell you the monthly and overall cost of your mortgage, based on the loan amount, interest rate, and term length.
The monthly repayments on a mortgage would be:
- Loan amount:
- Monthly repayments:
- Total to repay:
- Total interest:
How interest-only mortgages work:
With an interest-only mortgage, you only pay the interest each month. The original loan amount (the principal) remains unchanged and must be repaid in full at the end of the mortgage term. This means lower monthly payments, but you'll need a repayment plan for the full loan amount.
To get exact numbers based on your specific income, outgoings, age and other info, you'll need to speak to one of our experts. Lending policies change regularly, so this is purely for illustrative purposes only, and is not tailored financial advice.
Speak to one of our brokers to save money on your monthly repayments
- Free initial consultation with no obligation
- A dedicated expert team to handle everything for you
- Honest, unbiased advice from whole-of-market brokers
- Expert guidance tailored to your situation
Other factors that could impact your maximum borrowing
Mortgage lenders will carry out checks across their criteria, which could indirectly affect how much your monthly mortgage payment will be.
Some of the criteria which they’ll check will be:
Deposit and LTV
The higher your deposit, the less you need to borrow, making it more likely that a larger group of lenders will consider your application. So, you may be eligible for lower interest rates, making your £1,000 go even further.
Credit history
Lenders prefer applicants with good credit scores. While you can still get a mortgage with bad credit, the pool of lenders who will consider your application will be smaller, and the interest rate will likely be higher, so you may have to borrow less to keep to your monthly budget.
Mortgage type
The rates you are offered for your mortgage will increase according to how risky your required mortgage type is. Buy-to-let mortgage rates, for example, are usually higher than traditional ones. As a result, you might have to borrow less if you cannot increase your monthly repayment.
Get matched with the right mortgage broker for your budget
Using a broker can prove invaluable. They will be able to suggest the most suitable mortgage based on the amount you want to pay per month and guide you through your entire application. As a result, they can save you time, stress, and money by helping you qualify for a mortgage with the maximum amount you require at the lowest interest rate possible.
Our service will connect you with a mortgage advisor who can advise you on your specific situation. Call us today on 0330 818 7026 or make an enquiry so we can connect you with an expert.
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Pete Mugleston
CeMAP Mortgage Advisor, MD
Pete, a CeMAP-qualified mortgage advisor and an expert in all things mortgages, cut his teeth right in the middle of the credit crunch. With plenty of people needing help and few mortgage providers lending, Pete successfully went the extra mile to find mortgages for people whom many others considered lost causes. The experience he gained and his love of helping people reach their goals led him to establish Online Mortgage Advisor, with one clear vision – to help as many customers as possible get the right advice, regardless of need or background.
Pete’s presence in the industry as the ‘go-to’ for specialist finance continues to grow, and he is regularly cited in and writes for both local and national press, as well as trade publications, with a regular column in Mortgage Introducer and being the exclusive mortgage expert for LOVEMoney. Pete also writes for Online Mortgage Advisor of course!
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