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By Pete Mugleston | Mortgage Advisor

Pete has been a mortgage advisor for over 10 years, and is regularly cited in both trade and national press.

Updated: 22nd October 2020*

Mortgage lenders each have their own method of calculating your affordability, with many applying a multiple of your income to determine the maximum amount you can borrow.

But which numbers can you times your wage by, does bad credit affect your chances of getting a higher income multiple, and what can you declare as income? 

In this article, we look at the above questions and more, including: 

Read on for more information, or if you’d like to see how many times your income you could borrow, speak to one of the experts we work with. 

They’ll be able to assess your current circumstances and preferences to find mortgage lenders who could offer you the best deal for your income multiple. 

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How much mortgage can I afford?

Many mortgage lenders use a multiple of your income as a basis for establishing the maximum amount you can borrow. Every lender works within the parameters of its own guidelines, therefore, some can be more generous than others.

How do I work out how many times my salary I can borrow for a mortgage?

Most mortgage lenders use an income multiple of 4-4.5 times your salary, some offer a 5 times salary mortgage and a few will use 6 times salary, under the right circumstances to work out how much mortgage you can afford.

You’re unlikely to find a mortgage provider willing to lend to a maximum of x7 your salary or more in the UK.

The specific ‘times salary’ equation you can use to establish the maximum you can borrow for a mortgage will, as mentioned above, vary from lender to lender.

However, the table below provides some guidance as to how this may look:

Basic Salary4x Salary4.5x Salary5x Salary5.5x Salary6x Salary

The above figures illustrate the difference it can make to find a mortgage lender who is more generous with its income multiple criteria than others.

For somebody with a basic salary of £25,000, there’s a £50,000 difference between a lender using four times your salary and one using six times your salary to work out how much you can borrow.

Is there a salary mortgage calculator I can use?

To get a rough idea of how much of a mortgage you could borrow, check out our online mortgage calculator. All you need to do is enter a few basic details to calculate an amount. 

While our salary mortgage calculator is a great starting point, for a more accurate idea of how much you could borrow, make an enquiry.

Do mortgage lenders use the same affordability guidelines for secured loans?

Mortgage lenders tend to take a more relaxed view for the purpose of secured loans. By their very nature, a lender has the benefit of an asset as collateral for a secured loan, therefore, can afford to be much more generous when assessing the maximum amount somebody can borrow. Some mortgage lenders may be prepared to lend up to a maximum of 10x income for secured loans.

Instead of researching mortgage lenders and their lending criteria, save on time and effort by getting in touch. We’ll then match you with an expert shortly.

Can I declare any additional income on a mortgage application?

In addition to a basic wage, many employees have the opportunity to earn additional income.  Luckily there are lenders who offer mortgages with bonuses, overtime and commission factored in. You can also receive financial allowances for items such as a car, a house, or for relocation purposes, and there are mortgage providers who will take this into account, too.

Can I include any bonuses, overtime pay or commission as part of my total earnings?

Yes, this may be possible. However, unlike your basic salary not all mortgage lenders will necessarily accept the total amount of these additional forms of income. For earnings such as regular bonuses, overtime and commission payments most mortgage lenders will accept 50%, some will accept 75% and a few will accept 100%. 

Documentary evidence is usually required in order to clarify the amounts used and a whole-of-market broker can help you find the mortgage provider who takes the most flexible approach to your income type.

Can I include any allowances I receive as part of my total earnings?

Yes, there are providers who will be fine with this. If you receive financial allowances as part of your employment contract then most mortgage lenders will include these amounts as part of your total earnings used to establish how much you can borrow for a mortgage. A mortgage lender will likely want to see a copy of your employment contract to clarify the amounts.

How will additional income affect how much mortgage I can borrow?

It will depend on the amount and type of additional income you have.

We’ve put together a table which illustrates how much of an impact different types of additional income can make to how much you can borrow for a mortgage.

Basic SalaryRegular Annual Bonus*Annual Overtime Pay*Annual Commission*Yearly Housing Allowance4 x total earnings4 x basic salary

* = Bonus/Overtime/Commission capped at 50%

In the first example, the additional income results in a 100% increase in the amount you could borrow.

There are lots of other types of additional income you may be able to include – some mortgage lenders even treat things like benefits as declarable income. If you get in touch with us we can introduce you to an advisor we work with to discuss your own personal circumstances.

How much can a couple borrow on a joint mortgage?

If you’re looking to apply for a mortgage on a joint basis, either as a couple or with business partners, then the guidelines are pretty much the same as for sole applicants. You can include the total amount of both incomes when working out income multiples of your salaries to give an indication of how much you can borrow.

As two incomes are typically larger than one then a joint income mortgage application should result in a higher maximum amount you can borrow for a mortgage. Where there are more than two applicants, most mortgage lenders will use the two highest incomes for the purpose of establishing the maximum amount you can borrow, although a few will consider up to 4 times applicants’ income.

Salary ASalary BTotal Joint Salaries4x Joint Salaries5x Joint Salaries6x Joint Salaries

The above table illustrates how beneficial it can be to include both of your incomes to increase the maximum amount you can borrow. Just using one of these incomes would result in a much lower mortgage.

If you’re thinking of applying for a joint mortgage then make an enquiry with us and we will ask an advisor to discuss this further with you.

How many times my self-employed earnings can I borrow for a mortgage?

As outlined above, employees can work out how much they can borrow for a mortgage based on their basic salary plus any additional types of income that are included within the contract.

If you’re self-employed, the earnings from your business are used to work out how much you can borrow. Most mortgage lenders will also want to see a trading track record of at least 3 years, some will accept 2 years, a few will accept only 12 months, and a handful can even consider less than 12 months in the right circumstances.

Sole traders and partnerships

For sole traders or partnerships, most mortgage lenders will use the net profit drawn from the business. So, if the net profit averaged over the last 3 years equates to £25,000 then that is the income figure used to assess how much you can borrow for a mortgage.

Limited company directors

If you’re a director of your own limited company, most mortgage lenders will both salary drawn into account and any dividends paid. For a contractor mortgage, lenders will look at your daily rate, multiply this by five days a week and then use a number of working weeks (say, 47 to account for any holidays) to assess your annual earnings.

So, for example, if your daily rate was £150 per day over a 47 week trading year the equation would be: £150 x 5 x 47 = £35,250 annual earnings used to assess how much you can borrow for a mortgage.

If you’re self-employed and want to find out more about how much you can borrow for a mortgage get in touch and we can arrange for a specialist to speak to you directly.

What other factors may impact the amount I can borrow for a mortgage?

There’s no doubt that your income is one of the key factors that will influence the amount you can borrow for a mortgage.

However, there are a number of other variables that could also give a mortgage lender cause for concern, such as…


Assessing your income level is just one consideration a mortgage lender takes into account as part of their affordability criteria. They will also take an in-depth look at your outgoings (utility bills, dependent children, loans) to gain a full understanding of your current, and future, disposable income position. The outcome of this assessment may influence how much you can borrow for your mortgage.

Size of your deposit

Low deposits will result in fewer mortgage lenders giving an application due consideration. Those who do may restrict the amount you can borrow to negate this risk. 

Most mortgage lenders will accept deposits of 20%, some will accept 10% and a select few will accept as little as 5% for a residential property. Buy-to-lets usually have higher deposit requirements – the lowest you’re likely to find in the UK is 15%, while 25% is more likely.

Speak to a mortgage affordability specialist

If you are ready to find the right mortgage for you, have a question or you’d like to know more, call us on 0808 189 2301 or make an enquiry.

The independent mortgage brokers we work with have ‘whole-of-market’ access, meaning that they can find the best deals to suit your circumstances from a wide pool of mortgage lenders. The advice given won’t cost you anything, there’s no obligation to make a purchase, and there are no marks left against your credit. 

Updated: 22nd October 2020
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FCA disclaimer

*Based on our research, the content contained in this article is accurate as of most recent time of writing. Lender criteria and policies change regularly so speak to one of the advisors we work with to confirm the most accurate up to date information. The information on the site is not tailored advice to each individual reader, and as such does not constitute financial advice. All advisors working with us are fully qualified to provide mortgage advice and work only for firms who are authorised and regulated by the Financial Conduct Authority. They will offer any advice specific to you and your needs. Some types of buy to let mortgages are not regulated by the FCA. Think carefully before securing other debts against your home. As a mortgage is secured against your home, it may be repossessed if you do not keep up with repayments on your mortgage. Equity released from your home will also be secured against it.