Mortgage Affordability Calculator

How much mortgage can I afford?

Mortgage affordability depends on many factors beyond just your income. Lenders will assess your full financial situation, including your outgoings, credit history, employment status and the size of your deposit. As a general rule of thumb, most UK lenders will offer between 4 and 4.5 times your combined household income, although some specialist lenders may go higher for certain professions or circumstances.

Loan-to-value (LTV) is one of the most important factors in determining your mortgage rate. A lower LTV means a larger deposit relative to the property price, which reduces risk for the lender and typically results in better interest rates. Most competitive rates are available at 60% LTV or below. If your LTV is above 90%, you will face higher rates and fewer lender options. Above 95%, very few lenders will consider your application at all.

Monthly repayments are calculated using a standard amortization formula that splits each payment between interest and capital repayment. In the early years of your mortgage, most of your payment goes towards interest. As the balance decreases, a larger proportion goes towards paying off the principal. This calculator shows you exactly how this balance shifts over the full term of your mortgage in the year-by-year schedule above.