How is mortgage affordability calculated?

Lenders typically look at your income, outgoings and credit history. Many use an income multiple (often around 4–4.5× your gross income) as a starting point, but they also assess your monthly expenditure and existing debts. This calculator provides an educational estimate based on income multiples — actual lending decisions vary by lender.

Does the calculator include my partner's income?

Yes. You can enter both your annual income and your partner's annual income. The calculator adds them together to work out the combined borrowing estimate.

How does my deposit affect how much I can borrow?

Your deposit doesn't directly change how much a lender will offer you — that's based mainly on income and affordability. But a larger deposit means a lower loan-to-value (LTV), which can unlock better interest rates and means you can afford a more expensive property.

Is this a mortgage agreement in principle?

No. This is an educational calculator to help you estimate borrowing capacity. An agreement in principle (AIP) or decision in principle (DIP) requires a full credit check and affordability assessment by a lender.

How Much Can I Borrow for a Mortgage?

Estimate your mortgage borrowing capacity based on your income, deposit and existing monthly debts. This is an educational estimate — actual affordability depends on lender criteria, expenditure, credit history and other circumstances.

Your annual income (before tax)

Partner's annual income (optional)

Deposit

Existing monthly debt payments (optional)

Include loans, credit cards, car finance and other regular monthly commitments.

Assumed interest rate

Mortgage term

25 years

No sign-up · No tracking · Runs in your browser

Estimated borrowing range

£160,000 – £180,000

4.25×Loan to income £190,000 – £210,000Property price (incl. deposit)

What your result means

With a combined income of £40,000, lenders might offer between £160,000 and £180,000 (4–4.5× income). With a £30,000 deposit, that could buy a property worth £190,000–£210,000. At 5% over 25 years, the mid-point loan of £170,000 would cost about £994/month.

Combined income£40,000

Estimated monthly payment (mid-point)£994

Deposit£30,000

Important: This is an educational estimate based on typical income multiples (4–4.5× gross income). Actual mortgage affordability depends on lender criteria, your full expenditure, credit history, deposit size and other circumstances. Income multiples vary by lender and are not a universal rule. Always speak to a mortgage adviser or lender for an accurate assessment. See MoneyHelper for guidance on mortgage affordability.

How lenders may assess affordability

Every lender has its own affordability criteria, but most look at similar factors:

Income: Your gross (before tax) annual income, including salary, bonuses, overtime and some benefits.
Income multiples: Many lenders use 4–4.5× your gross income as a starting point, but this is not a universal rule. Some may offer more, some less.
Monthly expenditure: Lenders look at your regular outgoings, including existing debt repayments, household bills and living costs.
Credit history: A good credit record can improve your chances; missed payments or defaults can reduce what you're offered.
Deposit size: A larger deposit means a lower loan-to-value (LTV), which can unlock better rates and may improve affordability.
Stress testing: Lenders may check you could still afford payments if interest rates rose.

Example calculation

For a single applicant earning £40,000 with a £30,000 deposit and no existing debts:

Estimated borrowing range: £160,000 – £180,000 (4–4.5× income)
Loan-to-income: 4.25× (mid-point)
Potential property price: £190,000 – £210,000 (loan + deposit)
Estimated monthly payment on £170,000 at 5% over 25 years: ≈ £994

Assumptions

Income multiples of 4× (low) and 4.5× (high) are illustrative only — actual multiples vary by lender.
The mid-point loan is used to estimate monthly payments and property prices.
Interest rate is an assumption you enter — current rates vary by lender, product and LTV.
Existing monthly debts are shown for context but do not automatically reduce the estimate — lenders assess affordability individually.
This calculator does not include mortgage fees, valuation costs, legal fees or Stamp Duty.

What would you like to calculate next?

🏠

Mortgage Calculator

Work out your exact monthly repayment, total interest and LTV.

Open →

⚡

Mortgage Overpayment Calculator

See how much interest you could save by overpaying your mortgage.

Open →

🏴󠁧󠁢󠁥󠁮󠁧󠁿

Stamp Duty Calculator

Work out how much Stamp Duty you'll pay on your property purchase.

Open →

Sources

MoneyHelper — mortgages and buying a home: moneyhelper.org.uk
Bank of England — official Bank Rate and mortgage market data: bankofengland.co.uk
FCA — mortgage regulation and guidance: fca.org.uk

Casvia provides educational calculators and general information. It does not provide personal financial, tax or investment advice. Always speak to a qualified mortgage adviser or lender before making mortgage decisions.