It’s important that you know your budget when you buy a home. This is made up of your deposit, plus what size mortgage you’ll be accepted for. Find out how much you could borrow, and how you might be able to increase that amount.

How much can I borrow with a mortgage?

The easiest way to see what size mortgage you could be accepted for is to use MoneyHelper's Mortgage affordability calculator. When a lender decides how much money they’re willing to lend you, they weigh up a few factors. These include:

• how much you earn and any other income you receive
• your spending and debt payments 
• whether you’re employed permanently or on a contract
• any deductions from your pay like student loan payments or your pension
• your credit history, and
• your age. 

What is considered a big mortgage?

Usually, the largest mortgage you will get approved for is four and a half times your annual income. However, if you’re a very high earner with a steady career or live in London, they might approve you for more. 

Banks are allowed to offer mortgages for more than 4.5 times your salary, but they have a limit on the number of these larger mortgages they can approve. Some lenders have mortgages available for 5 or 6 times someone’s household income.

Before you decide to try and get a larger mortgage, consider whether high monthly payments are affordable for you. Interest rates will change over the length of your mortgage, and if you borrow more, then the impact of rate changes can be dramatic. Just a 1% or 2% rise in mortgage rates often means you’ll pay hundreds more per month. 

Pay off your debt

When lenders are calculating what you can afford to spend on a mortgage, they pay close attention to your existing debts.

If you can pay off what you owe, then you’ll show your lender you can borrow money responsibly, and it will free up more money from your income to put towards your mortgage each month. 

Consider a joint mortgage application

The maximum size of a mortgage is mostly based on your income; so, if you add someone else to your mortgage, that could increase your household income considerably and mean you qualify for a bigger mortgage.

Getting a joint mortgage will mean they have a claim on the property, so think carefully if you decide to do this. If you’re not both paying evenly towards the mortgage and deposit, it could be worth talking to a solicitor now so that the property can be divided fairly if you decide to sell it.  

Having a joint mortgage with someone will also link your credit reports. This means companies will look at both of your credit histories as part of any credit checks. If they have a poor credit history, this could lower your chances of acceptance.

Reduce your credit card limit

Lenders look at the credit that’s already available to you before giving you a mortgage in principle. This is because if you have a high credit limit, there’s a chance you’ll use it and then have debt repayments that could make your mortgage unaffordable. 

If you have a lot of unused credit, consider closing those accounts or reducing the limit if you want to borrow slightly more on your mortgage. However, this is only likely to make a small difference to how much you’re accepted for. 

Change your spending habits

Your lender will ask for bank or credit card statements when considering your mortgage application. They could ask for up to a year in past statements. They will look at your spending, and if they can see you have high outgoings, they could reduce what they are willing to lend you.  

If you’re planning to apply for a mortgage, it’s a great time to start working on a budget. You can use the money you’ll save to grow your deposit and prove to lenders that you can afford the repayments. 

Use MoneyHelper's free Budget planner to look at your spending and see where you could make a saving. 

Consider a guarantor mortgage

There are new types of mortgage that can allow you to borrow more, or even get a mortgage with no deposit, as long as you have a guarantor. A guarantor is someone who agrees to pay your mortgage if you can’t. It can be difficult to find someone who can be your guarantor, as they have to pass checks to prove they can afford to cover your mortgage as well as their own bills and commitments. Find out more about guarantor mortgages on Which?

Take out a longer mortgage term

Choosing to get a mortgage for 30 years or longer probably won’t allow you to borrow more overall, but it will make your monthly payments lower. If your income is high enough to qualify for the mortgage you want, but you’re worried about affording monthly payments, a longer mortgage could be a better choice.

However, the longer you have a mortgage for, the more you’ll pay back in interest. You also might need to think about whether a longer mortgage means that you’ll still be repaying after you retire.