When it comes to mortgages, it’s all about striking the right balance—borrowing enough to secure your dream home but not so much that repayments become a burden. That’s where our mortgage affordability calculator can help.
How Much Can You Afford to Borrow?
Simply enter your income and monthly outgoings, and our calculator will estimate how much you can comfortably borrow for a mortgage.
Once you get your results, you can adjust the repayment period or interest rate to match better any mortgages you’re considering. Plus, we’ll show you how much money you’ll have left each month, helping you make informed decisions about your budget.
[Start Your Mortgage Affordability Calculator]
How Does a Mortgage Work?
If you’re looking to buy a property but don’t have the full amount saved, a mortgage can help you bridge the gap.
A mortgage is a loan designed for buying property or land. The term typically ranges from 2 to 40 years, depending on your circumstances and the lender’s terms.
Here’s a quick overview of how mortgages work:
- You’ll need to save at least 5% of the property’s purchase price as a deposit.
- The remaining amount (the mortgage) is borrowed from a lender, such as a bank or building society.
- The lender charges interest on the amount borrowed, and you’ll make monthly payments to repay the loan over time.
- The loan is secured against your property until fully paid off.
If repayments aren’t maintained, the lender may repossess your home and sell it to recover the outstanding debt.
How Much Can You Borrow for a Mortgage?
Most lenders will allow you to borrow up to 4.5 times your annual income, but looking at your budget realistically is crucial before taking on a mortgage.
Lenders evaluate your income and expenses to ensure you can manage repayments, even if circumstances change, such as a rise in interest rates or fluctuations in your income.
When considering how much you can afford, don’t forget to account for other essential costs, including:
- Energy bills
- Council Tax
- Insurance
- Food and other living expenses
Budgeting for savings is also wise so you’re prepared for unexpected costs.
What You’ll Need to Apply for a Mortgage
When applying for a mortgage, you’ll need to provide:
- Proof of identity
- Evidence of your income (e.g., payslips or tax returns)
- Details of your monthly outgoings (e.g., bank statements)
Each lender may require different documents, so confirming their requirements is a good idea before starting your application.
Take the guesswork out of mortgage planning with our affordability calculator, and feel confident about the steps to securing your new home.
