Calculate Your Maximum Borrowing Capacity - Free Tool
Calculate how much you can borrow for a mortgage based on your income, expenses, and current UK lending criteria (September 2025). Our professional affordability calculator uses industry-standard income multiples (typically 4-4.5x annual salary, with some lenders offering up to 5.5x for high earners) and stress testing at higher interest rates to provide accurate borrowing estimates. Whether you're a first-time buyer exploring first-time buyer schemes or considering your deposit requirements, get instant results that reflect real UK lender assessments.
Enter your financial details to see how much you could borrow for a UK mortgage. Our calculator applies current lending criteria (September 2025) including affordability stress testing and income multiple assessments used by major UK lenders.
Mortgage affordability in the UK is determined by a combination of regulatory requirements, lender-specific criteria, and your personal financial circumstances. As of September 2025, UK lenders must follow Financial Conduct Authority (FCA) and Prudential Regulation Authority (PRA) guidelines to ensure responsible lending. Understanding these criteria helps you prepare effectively and maximize your borrowing potential.
Most UK lenders offer mortgage amounts between 4 and 4.5 times your gross annual income as the standard multiplier in 2025. However, this can vary significantly based on several factors:
UK lenders must stress test your affordability at interest rates significantly higher than the actual rate you'll pay. As of 2025, this typically means testing at 3% above the lender's standard variable rate (SVR) or your initial rate, whichever is higher. For example, if you're applying for a mortgage at 5.0%, the lender will assess whether you can afford payments at 8.0% or higher. This ensures you can continue making payments if interest rates rise significantly during your mortgage term.
The stress test also considers potential life changes such as having children, career breaks, or reduced income. Lenders want to ensure you have sufficient financial resilience to handle unexpected circumstances. Use our interest rate calculator to understand how rate changes affect your monthly payments.
Your debt-to-income (DTI) ratio is a critical factor in affordability assessments. UK lenders typically prefer a DTI ratio below 40-45%, meaning your total monthly debt payments (including the proposed mortgage) should not exceed 40-45% of your gross monthly income. All existing financial commitments are considered:
Reducing existing debts before applying can significantly improve your affordability. Paying off credit cards, closing unused credit accounts, and settling personal loans can increase your maximum borrowing amount by £20,000-50,000 or more, depending on your income level.
Your deposit size directly affects both your borrowing capacity and the interest rates available to you. Larger deposits reduce the loan-to-value (LTV) ratio, which lowers lender risk and unlocks better rates. In 2025, typical LTV tiers and their impacts include:
| Deposit % | LTV Ratio | Typical Rate Range | Advantages |
|---|---|---|---|
| 5% | 95% | 5.5-6.5% | Accessible for first-time buyers |
| 10% | 90% | 5.0-6.0% | Better rates, more lender options |
| 15% | 85% | 4.5-5.5% | Significantly better rates |
| 25% | 75% | 4.0-5.0% | Excellent rates, maximum choice |
| 40%+ | 60% or less | 3.5-4.5% | Best rates, lowest risk |
Use our deposit calculator to determine how much you need to save for different property prices and LTV ratios. Even increasing your deposit from 10% to 15% can save you £50-150 per month on a £250,000 mortgage due to better interest rates.
Your employment status significantly affects how lenders assess your income and the multiples they'll offer:
Your credit score doesn't directly determine your maximum borrowing amount, but it significantly affects approval likelihood and interest rates offered. In 2025, UK lenders use credit reference agencies (Experian, Equifax, TransUnion) to assess your creditworthiness:
Improving your credit score before applying can increase your borrowing capacity by £15,000-40,000 through better rates and higher multiples. Key improvements include: registering on the electoral roll, paying all bills on time for 6+ months, reducing credit utilization below 30%, and correcting any errors on your credit report.
While UK lending criteria are generally consistent nationwide, some regional factors can affect affordability:
Essential information about mortgage affordability in the UK
UK lenders typically use income multiples (usually 4-4.5 times annual income as of September 2025, with some lenders offering up to 5.5x for high earners) combined with affordability stress testing. They assess your ability to repay at higher interest rates (typically 3% above current rates as per FCA/PRA requirements) and consider all your regular expenses and existing debts to ensure you can comfortably manage payments.
Key factors include your gross annual income, monthly expenses, existing debts, credit score, deposit size, employment stability, and the chosen mortgage term. Lenders also consider future interest rate changes and your overall financial resilience.
You can improve affordability by increasing your deposit (even 5% more can unlock better rates), reducing existing debts (paying off credit cards can increase borrowing by £20,000-50,000), improving your credit score (750+ scores access best rates), extending the mortgage term (longer terms reduce monthly payments but increase total interest), or applying jointly with a partner (combined incomes significantly increase capacity). Consider timing your application when your income is stable and your financial position is strongest. Use our repayment calculator to see how different terms affect your payments.
As of September 2025, most UK lenders offer 4-4.5 times your gross annual income as standard. However, high earners (£75,000+) can access up to 5.5x income multiples with certain lenders, particularly for professionals in stable careers like doctors, lawyers, and senior corporate roles. Some specialist lenders may offer even higher multiples (up to 6x) for exceptional circumstances, though these are rare and subject to strict affordability assessments. Self-employed applicants typically receive 3.5-4.5x multiples based on average profits over 2-3 years. Joint applications combine both incomes fully, potentially doubling your borrowing capacity.
The minimum deposit for most UK mortgages is 5% of the property value (95% LTV), though 10% deposits (90% LTV) offer significantly better interest rates and more lender options. First-time buyers can access 5% deposit mortgages through government-backed schemes and mainstream lenders. However, larger deposits provide substantial benefits: 15% deposits unlock rates 0.5-1.0% lower than 5% deposits, potentially saving £100-200/month on a £250,000 mortgage. A 25% deposit (75% LTV) provides access to the best rates and maximum lender choice. Use our deposit calculator to determine how much you need for different property prices and LTV ratios.
Yes, most UK lenders consider bonuses, overtime, and commission when calculating affordability, but with varying approaches. Typically, lenders require 2-3 years of consistent bonus/overtime history and will use an average or percentage (often 50-100%) of these earnings. Guaranteed bonuses are usually fully considered, while discretionary bonuses may be averaged over 2-3 years. Overtime is generally included if it's regular and evidenced by payslips over 6-12 months. Commission-based income requires longer track records (12-24 months) with lenders using conservative averages. Some lenders are more generous with variable income than others, so it's worth comparing options if bonuses/overtime form a significant part of your income. This additional income can increase your borrowing capacity by £15,000-60,000 depending on amounts and consistency.
UK lenders must stress test your affordability at interest rates significantly higher than your actual rate, typically 3% above the lender's standard variable rate (SVR) or your initial rate, whichever is higher. For example, if you're applying for a 5.0% mortgage, the lender assesses whether you can afford payments at 8.0% or higher. This ensures you can continue making payments if interest rates rise during your mortgage term. The stress test also considers potential life changes like having children, career breaks, or reduced income. Some lenders apply additional buffers for higher-risk profiles or larger loans. This testing can reduce your maximum borrowing by 20-30% compared to calculations based solely on the actual interest rate. Use our interest rate calculator to understand how rate changes affect your monthly payments.
Yes, it's possible to get a mortgage with bad credit in the UK, but you'll face higher interest rates, lower income multiples (typically 3-3.5x vs 4-4.5x), and may need a larger deposit (15-25% minimum). Specialist lenders cater to applicants with credit issues including CCJs, defaults, IVAs, or bankruptcy. The severity and recency of credit problems matter significantly: minor issues over 3 years old have minimal impact, while recent defaults or bankruptcy require specialist lenders. Improving your credit score before applying can increase your borrowing capacity by £15,000-40,000 through better rates and higher multiples. Key improvements include: registering on the electoral roll, paying all bills on time for 6+ months, reducing credit utilization below 30%, and correcting any errors on your credit report. Consider waiting 6-12 months to improve your credit profile if possible, as this can save you thousands in interest over the mortgage term.
Joint mortgage applications typically double your borrowing capacity by combining both applicants' incomes fully. For example, if you earn £40,000 and your partner earns £35,000, lenders will assess affordability based on the combined £75,000 income, potentially offering £300,000-412,500 (at 4-5.5x multiples). However, lenders also consider both applicants' debts, expenses, and credit profiles. If one applicant has poor credit or significant debts, this can reduce the overall borrowing amount or result in higher interest rates. Both applicants are equally liable for the full mortgage debt, regardless of income contribution. Joint applications work well when both applicants have stable incomes, good credit scores, and minimal existing debts. Consider using our mortgage term calculator to see how different loan amounts and terms affect your monthly payments.
UK lenders conduct detailed assessments of your monthly expenses including: essential costs (utilities, council tax, insurance, food, transport), existing debts (credit cards, loans, car finance, student loans), childcare costs, child maintenance payments, and discretionary spending (entertainment, subscriptions, holidays). Some lenders use your actual declared expenses, while others apply minimum living cost figures based on household size and location (typically £200-400 per adult, £100-200 per child monthly). Credit card limits are particularly important - lenders often assume you'll use 3-5% of your total credit limit monthly, even if you pay in full. For example, £20,000 in total credit card limits could reduce your borrowing capacity by £30,000-50,000. Closing unused credit cards and reducing limits before applying can significantly improve your affordability. Be honest about expenses as lenders verify through bank statements (typically 3-6 months) and inconsistencies can lead to application rejection.