Most lenders use around 4 to 4.5 times your gross annual income as a starting point. Some may consider higher multiples, such as 5, 5.5 or even 6 times your income, depending on your circumstances.
Your salary is only part of the calculation. Lenders will also consider your regular spending, debts, deposit and credit history, which is why two people earning the same amount could receive different borrowing estimates.
How mortgage income multiples work
An income multiple compares the amount you want to borrow with your annual income before tax. Using the upper end of the typical range, someone earning £50,000 would have an initial borrowing estimate of £225,000.
You may also come across the term “multiple of salary mortgage”. Despite the name, this is not a separate type of mortgage, just another way of describing the calculation.
Income multiple
Example borrowing on a £50,000 salary
4 times
£200,000
4.5 times
£225,000
5 times
£250,000
5.5 times
£275,000
6 times
£300,000
Even so, the figures in the table are only examples. The lender will also check your take-home pay and monthly bills before deciding how much to offer.
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Estimate how much you may be able to borrow before applying for a mortgage.
Can you borrow five or six times your salary?
Some lenders may offer a mortgage based on five times your salary. Borrowing six times your income can also be possible, but it is available to fewer applicants and usually depends on meeting more specific criteria.
There is no single income multiple used across the UK. Each lender takes a different approach, and factors such as your income, profession, existing commitments, deposit, credit history and mortgage term can all affect how much you could borrow.
First-time buyers and applicants in certain professions may have access to higher multiples. Even then, lenders will assess overall affordability, so a high income alone does not guarantee the maximum borrowing amount or a mortgage offer.
Worth knowing
A higher income multiple is not guaranteed. Lenders still assess your spending, debts, deposit, credit history and overall affordability.
What affects your mortgage salary multiple?
Lenders look beyond your basic salary when deciding how much you could borrow. These four factors can influence the income multiple they use.
Income type and stability
Lenders may count salary, overtime, bonuses and commission differently. Regular income is often easier to use in full.
Debts and monthly commitments
Loans, credit cards, car finance and childcare reduce the money available for mortgage payments.
Deposit and credit history
A larger deposit lowers your loan-to-value and may give you access to more products. A strong credit history can also help.
Age and mortgage term
A longer term can lower the monthly payment. However, if the mortgage runs into retirement, the lender may ask about your expected retirement income.
How joint salary multiples work
With a joint mortgage, lenders may use both applicants’ incomes. For example, if one person earns £30,000 and the other earns £25,000, their joint salary is £55,000. Using a 4.5 times multiple would give a starting estimate of £247,500.
However, lenders also review each person’s spending, debts and credit history. Adding a second income may increase your borrowing, but high monthly commitments or poor credit could reduce the amount offered.
Learn how joint mortgage affordability works →
How Muttuo Mortgages can help
Lenders can assess income and borrowing potential in different ways. We can help you understand what may be realistic for your circumstances.
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