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What Income is Needed for a Mortgage?

Read Expert guidance on how much income is needed for mortgages and how to secure the best rate

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Pete Mugleston

Author: Pete Mugleston - Mortgage Advisor, MD

Updated: June 28, 2022

How much do you need to earn to get the mortgage you’re looking for?

We are constantly asked, “how much do I need to earn to get the amount of mortgage I’m looking for?” The answer to this is not that straightforward, hence why it can be difficult for people to establish exactly how much they can borrow. The reason for this is that all lenders use their own criteria to assess income and affordability.

The advisors we work with are experts and are whole of market, so even if you’ve been declined or have bad credit, they will be able to give you the right advice for your circumstances.

How do you work out how much income you’ll need for a mortgage?

Traditionally all lenders have used a basic income multiple as a rule of thumb to determine the maximum amount you can borrow for a mortgage. However, because lenders don’t all use the same income multiple equation this means some can be more generous than others.

Most lenders will use an income multiple of 4 times your salary, some will use 5 times your salary but there are a select few who will use 6 times your salary. But, how does this work out for you and your income? Try our mortgage affordability calculator to find out:

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Mortgage Affordability Calculator

Our affordability calculator can tell you how much you can potentially borrow from a mortgage lender. Simply enter your total household income below and our calculator will do the rest.

Input full salaries for all applicants
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You could borrow up to 

Most lenders would consider letting you borrow

This is based on 4.5 times your household income, the standard calculation used by the majority of mortgage providers. To borrow more than this, you will need to use a mortgage broker to access specialist lenders.

Some lenders would consider letting you borrow

This is based on 5 times your household income, a salary multiple you might struggle to qualify for without the help of a broker. This income multiple is not widely available to customers who are applying directly with a lender.

A minority of lenders would consider letting you borrow

This is based on 6 times your household income, a salary multiple you will struggle to get without a broker. Six-times salary mortgages are usually only available under very specific circumstances.

Get Started with an expert broker to find out exactly how much you could borrow.

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Example calculations

Let’s take a further look at how varying income multiples, across a range of illustrative annual earnings, can affect the amount you can borrow for a mortgage.

Income 4 x income 4.5 x income 5 x income 5.5 x income 6 x income
£20,000 £80,000 £90,000 £100,000 £110,000 £120,000
£30,000 £120,000 £135,000 £150,000 £165,000 £180,000
£40,000 £160,000 £180,000 £200,000 £220,000 £240,000
£50,000 £200,000 £225,000 £250,000 £275,000 £300,000
£60,000 £240,000 £270,000 £300,000 £330,000 £360,000
£70,000 £280,000 £315,000 £350,000 £385,000 £420,000
£80,000 £320,000 £360,000 £400,000 £440,000 £480,000
£90,000 £360,000 £405,000 £450,000 £495,000 £540,000
£100,000 £400,000 £450,000 £500,000 £550,000 £600,000

The above table is for demonstrative purposes only and you should always consult your lender or broker for the most up-to-date information.

As you can see from the table above, the income multiple used by your lender can make quite an impact upon the amount you can borrow. A lender using 6 times your income can offer you a mortgage 50% higher than a lender using 4 times your income.

If you are in a relationship as a dual-income household it may make more sense to apply for a joint mortgage as you can use your combined earnings to increase the size of your mortgage.

Rather than taking the time to conduct your own research on what every lender’s income multiple policies are, why not let us help? If you get in touch we can arrange for an expert who has an in-depth understanding in this area to speak with you.

Now let’s look more closely at some examples of what you would need to earn for a specific mortgage amount:

What income is needed for a 120k mortgage?

The table below shows how much you need to earn, depending on the income multiple used by a lender, for a £120k mortgage.

Target Mortgage Amount 4x Salary (Income needed) 4.5x Salary (Income needed) 5x Salary (Income needed) 5.5x Salary (Income needed) 6x Salary (Income needed)
£120,000 £30,000 £26,667 £24,000 £21,818 £20,000

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What income is needed for a 160k mortgage?

The table below shows how much you need to earn, depending on the income multiple used by a lender, for a £160k mortgage.

Target Mortgage Amount 4x Salary (Income needed) 4.5x Salary (Income needed) 5x Salary (Income needed) 5.5x Salary (Income needed) 6x Salary (Income needed)
£160,000 £40,000 £35,555 £32,000 £29,090 £26,667

What income is needed for a 400k mortgage?

The table below shows how much you need to earn, depending on the income multiple used by a lender, for a £400k mortgage.

Target Mortgage Amount 4x Salary (Income needed) 4.5x Salary (Income needed) 5x Salary (Income needed) 5.5x Salary (Income needed) 6x Salary (Income needed)
£400,000 £100,000 £88,888 £80,000 £72,727 £66,666

What income is needed for a 500k mortgage?

The table below shows how much you need to earn, depending on the income multiple used by a lender, for a £500k mortgage.

Target Mortgage Amount 4x Salary (Income needed) 4.5x Salary (Income needed) 5x Salary (Income needed) 5.5x Salary (Income needed) 6x Salary (Income needed)
£500,000 £125,000 £111,111 £100,000 £90,909 £83,333

What income is needed for a 600k mortgage?

The table below shows how much you need to earn, depending on the income multiple used by a lender, for a £600k mortgage.

Target Mortgage Amount 4x Salary (Income needed) 4.5x Salary (Income needed) 5x Salary (Income needed) 5.5x Salary (Income needed) 6x Salary (Income needed)
£600,000 £150,000 £133,333 £120,000 £109,090 £100,000

What income is needed for an 800k mortgage?

Target Mortgage Amount 4x Salary (Income needed) 4.5x Salary (Income needed) 5x Salary (Income needed) 5.5x Salary (Income needed) 6x Salary (Income needed)
£800,000 £200,000 £177,777 £160,000 £145,454 £133,333

The table below shows how much you need to earn, depending on the income multiple used by a lender, for an £800k mortgage.

What income is needed for a £1 million mortgage?

The table below shows how much you need to earn, depending on the income multiple used by a lender, for a £1 million mortgage.

Target Mortgage Amount 4x Salary (Income needed) 4.5x Salary (Income needed) 5x Salary (Income needed) 5.5x Salary (Income needed) 6x Salary (Income needed)
£1,000,000 £250,000 £222,222 £200,000 £181,818 £166,666
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What other factors could impact the amount you need to borrow for a mortgage?

Additional income

When calculating your total earnings for the basis of an income multiple exercise it’s important that you include any additional income you earn on top of your basic salary such as bonuses, overtime or any allowances you receive as part of your contract.

Not all lenders will necessarily accept the total amount of these additional forms of income. For example, earnings from bonuses and overtime may be capped. Most lenders will usually accept 50%, some will accept 75% and a few will accept 100%.

By including any additional income you get, in turn, you will increase your chances of achieving the mortgage amount you need to buy your property.

For more information on different types of additional income and how they are viewed by lenders have a look at this article here(affordability article on additional income).

Outgoings

Using your total earnings to work out the maximum mortgage you can get only really tells half the story. A lender also needs to understand how much of those earnings are being spent each month in order to accurately assess whether you can afford your mortgage repayments.

Looking at one of the income examples from the table above, if you earn £100,000 per annum but you’re outgoings total £99,000 can you really afford a mortgage of £400,000?

Since the 2014 Mortgage Market Review (MMR) all UK lenders are now expected to undertake a thorough affordability assessment of your current outgoings and conduct a ‘stress-test’ of any future expenditure.

The outcome of this assessment will determine the mortgage a lender is prepared to offer you.

If you get in touch with us we can ask an advisor we work with to discuss this area with you in more detail.

Speak to an affordability expert

If you have questions and want to speak to an expert for the right advice, call Online Mortgage Advisor today on 0808 189 2301 or make an enquiry here.

Then sit back and let us do all the hard work in finding the broker with the right expertise for your circumstances.  – We don’t charge a fee and there’s absolutely no obligation or marks on your credit rating.

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We know everyone's circumstances are different, that's why we work with mortgage brokers who are experts in all different mortgage subjects.

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FAQs

Will the size of my deposit affect what I can borrow for a mortgage?

As with affordability criteria, all lenders have their own rules regarding the size of deposit they require. In general, most lenders will accept 20% deposits, some will accept 10% deposits and there are a few who will accept as little as 5%.

However, lower deposits will mean fewer lenders will consider an application. It may be tricky to find a lender who will accept a low deposit whilst offering a generous income multiple policy. This is why it’s important you get in touch with us so a specialist can look at this with you.

Will a poor credit record affect my chances of getting a mortgage?

There’s no doubt a poor credit record can affect your chances of getting a mortgage depending on the type of issue you’ve had and when it was registered.

It will, inevitably, reduce the number of lenders who would look at the application.  Some lenders will never accept a mortgage application with credit issues but there are a few specialist lenders who will consider someone who currently has a poor credit record.

For more information on this see our bad credit mortgage information section here. Or you can make an enquiry and we’ll refer you to one of the experts we work with for the right advice.

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About the author

Pete, 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 found great success in going the extra mile to find mortgages for people whom many others considered lost causes. The experience he gained, coupled with 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 OMA of course!

Read more about Pete

Pete Mugleston

Mortgage Advisor, MD

FCA disclaimer

*Based on our research, the content contained in this article is accurate as of the 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.

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