Mortgage Affordability Calculator
Estimate how much a UK lender might let you borrow based on income, monthly outgoings, deposit, and the salary multiple your lender applies.
Maximum borrowing
£259,200.00
- Maximum property value
- £289,200.00
- Combined annual income
- £60,000.00
- Income multiple applied
- 4.5
- Reduction for monthly outgoings
- £10,800.00
- Loan-to-value at maximum
- 89.63%
- Deposit as % of max property
- 10.37%
Headline figure follows the Bank of England Financial Policy Committee's 4.5× loan-to-income ceiling — the de facto cap on UK mainstream residential lending. Most lenders allow 4–5× household income; some stretch to 5.5× for higher earners. Monthly outgoings reduce affordable income before the multiple is applied. Lenders also stress-test at a notional rate (typically the product rate + 1%, or a floor around 8–8.5%) and review credit history, expenditure, and employment type. Treat this as an upper-bound estimate, not a mortgage offer.
How to use this calculator
Enter your gross annual income, your joint applicant's income (or zero if you're applying alone), your monthly committed outgoings (credit-card minimums, loans, car finance, child maintenance), the deposit you have ready, and the salary multiple you expect your lender to apply. The default 4.5× matches the Bank of England's loan-to-income flow limit. Results update as you type.
How the calculation works
Maximum borrowing is calculated as combined annual income × salary multiple, minus an adjustment for committed monthly outgoings (monthly outgoings × 12 × multiple). Maximum property value is borrowing plus deposit; the LTV figure shows the loan-to-value ratio that purchase would require. There is no single FCA-prescribed formula — MCOB 11.6 sets qualitative affordability standards and lenders apply their own rules. The 4.5× cap comes from the Financial Policy Committee, which limits the share of new lending above 4.5× household income to 15% of each lender's mortgage book (FPC Recommendation, June 2014, periodically reaffirmed).
Worked example
Combined income £60,000 (£40k + £20k), £200/month committed outgoings, £30,000 deposit, 4.5× multiple. Headline borrowing = £60,000 × 4.5 = £270,000. Outgoings reduction = £200 × 12 × 4.5 = £10,800. Maximum borrowing = £259,200. Maximum property value = £259,200 + £30,000 = £289,200. LTV at maximum = £259,200 ÷ £289,200 ≈ 89.6%, meaning you would also need a lender willing to lend at 90% LTV.
Frequently asked questions
How accurate is a salary-multiple affordability estimate?
It is an upper-bound estimate, not a mortgage offer. UK lenders combine the salary multiple with a stress test (typically the product rate plus 1%, or a floor around 8–8.5%), an expenditure assessment, a credit search, and rules specific to employment type (employed, self-employed, contractor). Two lenders can quote very different maximum loans for the same applicant. Use the result as a sanity check, then speak to a regulated mortgage broker for an actual decision-in-principle.
Why is 4.5× the default multiple?
In June 2014 the Bank of England's Financial Policy Committee recommended that no more than 15% of any lender's new mortgages be at loan-to-income ratios at or above 4.5×. This rule (the "LTI flow limit") has been reaffirmed periodically and remains in force, which makes 4.5× the de facto mainstream ceiling. Some lenders stretch to 5–5.5× for high earners, professionals, or those passing strict affordability tests, but the bulk of UK lending sits at 4–4.5×.
What counts as a "monthly committed outgoing"?
Anything you pay every month that you cannot easily cancel: personal loan repayments, car-finance payments, credit-card minimum payments, student loan deductions, child maintenance, and ongoing childcare costs. Lenders look at these because they reduce the income available to service a mortgage. Subscriptions, groceries, and energy bills are usually folded into a separate expenditure assessment rather than this debt-style adjustment.
Does the deposit affect how much a lender will lend?
Indirectly. The deposit doesn't change the income-multiple cap, but it does set the LTV — and high-LTV lending is more expensive and harder to obtain. Mainstream lenders typically cap residential mortgages at 90–95% LTV; the cheapest rates appear at 60% LTV and below. The calculator shows the LTV your maximum borrowing would imply at your deposit, so you can see whether the property price is realistic for the lending market.
Why can two applicants with the same income borrow very different amounts?
Lender criteria differ in the multiple applied, the treatment of bonus and commission income, the stress rate used, the affordability model (some use the FCA-defined "modified affordability assessment" for remortgages, others a fuller expenditure breakdown), and credit-history thresholds. Self-employed income typically uses the lower of the last two years' filed accounts or the two-year average; contractors are sometimes assessed on day-rate × 5 × 46 weeks. Two lenders can be £80,000 apart for the same applicant.
Does this calculator include stamp duty or other purchase costs?
No. It estimates the headline mortgage size only. On a property purchase you will also need budget for Stamp Duty Land Tax (SDLT — England/NI), conveyancing, valuation and survey fees, mortgage product fees, and removals. SDLT alone can be 0–12%+ of the property price depending on band and whether it is a first home, additional property, or non-UK-resident purchase.