Mortgage Affordability

Mortgage lenders use a variety of factors to calculate how much you can borrow, including:

• Your income: This is the most important factor, as lenders want to ensure you can repay your mortgage. They will look at your gross income (your salary before tax) and your net income (your salary after tax)

• Your outgoings: This includes monthly expenses, such as rent or mortgage payments, bills, debt repayments, and groceries. Lenders will want to make sure that you have enough money left over each month to cover your mortgage repayments

• Your deposit: This is the amount of money you will need to put down as a down payment on your property. The larger your deposit, the less you will need to borrow, and the lower your monthly repayments will be

• Your credit score: This is a number that lenders use to assess your creditworthiness. A higher credit score means that you are considered to be a lower-risk borrower and you may be able to get a better deal on your mortgage

• The type of mortgage you apply for: Different types of mortgages are available, with different terms and conditions. Some mortgages are more suitable for people with lower incomes or larger debts

• The property you want to buy: The value of the property you want to buy will affect how much you can borrow. Lenders will usually only lend you up to a certain percentage of the property’s value

Once you have applied for a mortgage, the lender will assess your application and decide how much they will lend you. They will consider all of the factors listed above and any other information you have provided.

It is important to remember that the amount you can borrow will depend on your circumstances. If you are unsure how much you can borrow, speaking to a mortgage advisor is always best. They will be able to help you understand the different types of mortgages available and advise you on the best option.