What Are the Typical Mortgage Affordability Criteria I Need to Know?

Mortgage criteria vary wildly between lenders, and it can be impossible to choose wisely if you don't know which affordability metrics you'll need to meet. Our thorough guide runs through all the crucial information and affordability criteria and their impact on your mortgage application.

About your mortgage

Error: Yearly income income must be between £1 and £10,000,000.

Error: Regular bonus must be between £1 and £10,000,000.

Based on your yearly income, you may be able to borrow:


Most lenders will let you borrow 4.5 times your annual salary so, as long as you have a standard 10% deposit, you should be able to borrow this much.


Depending on your personal circumstances, some lenders may let you borrow 5 times your salary.


Lenders usually cap the amount they lend at 5.5 times your salary, so it’s unlikely you’ll be able to borrow more than this.

This calculator is an estimation of how much you could borrow. If you’re ready to take out a mortgage, speak to a Revolution brokers to see what options are available.

What Are the Typical Mortgage Affordability Criteria I Need to Know?

UK mortgage lenders all have their own policies and rules, and so the affordability criteria for a mortgage are not universal.

Circumstances that might cause one lender to reject an application automatically will be acceptable to another, although most lenders will review the same factors - with different outcomes.

Here we'll summarise the main criteria that lenders look for when deciding whether to lend - and why it is so important to use an experienced broker before making a tentative application to a lender without knowing their eligibility requirements.

For more information, or for help with a mortgage application whether you have already been turned down elsewhere or are just starting your borrowing search, give us a call on 0330 304 3040, or email the team at info@revolutionbrokers.co.uk.

What are the Typical Affordability Requirements for a UK Mortgage?

Affordability assessments look at what you earn, and what you spend, for a lender to determine whether they feel comfortable that you can afford to keep up with the repayments on your borrowing.

Generally, lenders start this process by calculating your annual income and applying a multiple to that.

For example, if you earn £25,000 per year, you're likely to be able to borrow somewhere around £100,000 from a lender who caps their mortgages at four times your earnings.

What Other Calculations Impact a Mortgage Affordability Assessment?

This calculation is very basic and is the starting point - whereas multiple factors and criteria later come into play.

Lenders have a responsibility to lend to people against strict criteria, and not offer to lend to somebody they know is unlikely to be unable to afford the costs.

Most UK lenders offer around four or 4.5 times your annual earnings as a maximum. You can borrow as high as five or even six times your salary, although this is less common.

You can get a rough idea about what you might be able to borrow from the table below. This illustration shows the maximum you might be able to borrow from a range of lenders, based on their income multiple calculations:





Lender A - 4 x Salary




Lender B - 4.5 x Salary




Lender C - 5 x Salary




Lender D - 5.5 x Salary




Lender E - 6 x Salary




How Can I Calculate What Mortgage I Can Afford to Repay?

Calculating mortgage costs isn't straightforward. A lot depends on what interest rates you might be offered, which in turn depends on your deposit, age, type of property and credit score.

The easiest way to get a good idea about your borrowing potential is to work with an independent broker who can offer tailored advice based on your circumstances.

If you need to borrow the maximum allowable within your earnings, you will likely need a broker to negotiate this on your behalf, as well as putting you in touch with the most flexible lenders who can meet your borrowing needs.

How Much of My Income is Included in the Affordability Assessment?

Another complication exists where you earn anything outside of a basic salary.

That could be because you're self-employed, have a rental property, receive benefits, or have a variable income based on overtime, bonuses or commissions.

Lenders will typically include variable pay in their calculations, but some will include 100% of it, some 75% and some 50%. So, if you need to maximise your income, or have a large proportion of your payments made up of commissions, you must seek a broker who can recommend the lenders who have the most generous income calculations and consider these other earnings.

Do Employment AllowancesCount Towards Mortgage Affordability?

They can do, but like most things, it depends on finding the right lender.

You might have a car allowance or housing allowance as an employment benefit. Those lenders that will include this income will typically ask for written confirmation from your employer, or sight of a contract to quantify the value.

The below table sets out three scenarios where an applicant earns variable income in addition to a basic salary, and how much they might be able to borrow depending on the policies of their lender.

Basic Salary

Annual Bonus

Yearly Overtime

Annual Commissions

Yearly Allowances

Lender A - 4 x Income Plus 50% of Variable Pay

Lender B - 4 x Income Excluding Variable Pay






















As you can see, if you have a larger proportion of bonuses or overtime, you could borrow significantly more by choosing a lender who will include these elements of your income.

How Does Mortgage Affordability Work for Self-Employed People?

Mortgages for self-employed people aren't any different, but the calculations will be.

If you are self-employed, a lender will use your average annual income to calculate what they can lend, since this will be more likely to change from year to year than a basic salary.

Most lenders prefer applicants with at least three years of trading history. However, some will offer mortgages to newer self-employed businesses, and be happy to use the accounts from one or two years of trading.

If you are a Ltd company director, lenders tend to use your salary and dividends and work out the average per year to calculate how much they can lend.

Contractor mortgages take your day rate and work out an average assumed income by presuming you work five days per week and around 48 weeks per year.

What Outgoings are Included in an Affordability Assessment?

As well as your income, a mortgage lender will need to assess your outgoings. These are deducted from your income to arrive at a net disposable income estimate and used to calculate a debt to income ratio.

Relevant outgoings can include:

  • Insurance costs
  • School fees
  • Travel tickets
  • Pension contributions
  • Utilities
  • Council tax
  • Other debts
  • Living costs
  • Dependents

As well as existing outgoings, a lender will need to stress-test your application. That means checking what would happen if your circumstances change, or the interest rates rise, to ensure you'd still be able to afford the repayments.

How Does Mortgage Affordability Work for Buy to Let Mortgages?

Buy to let mortgages are slightly different, in that the lender is usually less concerned with what you earn, as they are with how much rental income the property is expected to generate.

This calculation is called income coverage and is a ratio of the total income against the monthly interest-only cost.

Most lenders will need an income cover ratio of at least 125% up to 145% depending on your tax status. Therefore if you want to mortgage an investment property that will cost £100 per month in interest, the rent must be at least £125 or £145 to pass the assessment.

In some cases, a lender will have an additional income threshold for a buy to let application, usually if the landlord doesn't have prior experience in the rental market. That threshold tends to be around £25,000.

Can I Still Pass an Affordability Assessment With Bad Credit?

Having bad credit can make it more difficult to find a mortgage, but doesn't mean you will always be turned down - and different lenders have different views when it comes to assessing applicants who have had credit issues in the past.

It might be that a bad credit lender is your best bet, but a lot depends on what sort of issues you have experienced when they occurred, and if you are now in a good financial position.

Expert Help with Mortgage Affordability

Whether you're concerned about being approved for the size of mortgage you wish to apply for or would like to know what sort of loan you could afford, we are here to help.

The business loan broker team is available on 0330 304 3040, or via email at info@revolutionbrokers.co.uk.

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FCA disclaimer

The content included in our articles, blogs, web pages and news publications is based on information accurate at the time of writing. Note that policies and criteria can change regularly throughout the UK mortgage lending market, and it remains essential to contact the consultation team to receive up to date guidance. The information included on the Revolution Brokers site is not bespoke to any circumstances or individual application scenarios and therefore is not intended to be used as financial advice. The content we share is designed to be informative and helpful but cannot be relied upon to provide individual advice relevant to your mortgage requirements. All Revolution team members are fully qualified, trained and experienced to provide mortgage advice of an independent nature. We collaborate with lenders and providers who are regulated, authorised and registered with the Financial Conduct Authority (FCA). Should you require specific mortgage borrowing types, some products such as buy to let mortgages may not be FCA regulated. The Revolution team can provide further information about regulated and unregulated lending as required. Please remember that a mortgage is a debt which is secured against your home or property. Your home can be at risk of repossession if you do not keep up with the repayments or encounter any other difficulties in managing your mortgage borrowing responsibly. This also applies to any remortgage or home loan secured against your property, including equity release products.

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