Calculator

Mortgage Affordability Calculator

See a simple estimate of how much you might be able to borrow, your likely monthly repayment, and your loan-to-value — a starting point before you speak to a lender.

How this estimate works

Maximum borrowing is estimated as your household income multiplied by an income multiple (commonly around 4.5×). Monthly repayments use the standard repayment formula based on the loan you need, the interest rate and the term. Real lenders assess much more, including outgoings, credit history and stress tests.

This is an estimate, not financial advice

This calculator gives a simplified guide only. Lenders assess affordability differently, using your spending, other debts, credit history and interest rate stress tests, and rates change over time. For a decision you can rely on, speak to a mortgage broker or lender.

How we calculate this

We estimate maximum borrowing as household income × income multiple (default 4.5×, a common lender benchmark). The monthly repayment uses the standard capital-and-interest formula:

M = P · r(1+r)ⁿ ÷ ((1+r)ⁿ − 1)

where P is the loan amount, r the monthly interest rate, and n the number of monthly payments. The affordability status compares the loan you would need with your income-multiple ceiling. Real lenders assess far more — spending, debts, credit history and stress tests — so this is an estimate, not an offer.

How mortgage affordability is estimated

This calculator uses two simple ideas. First, an income multiple gives a rough ceiling on borrowing — many lenders lend around 4.5 times annual income. Second, the standard repayment formula turns the loan you need into an estimated monthly payment based on the interest rate and term. Putting the two together shows whether the property you have in mind looks within reach.

What the results mean

Maximum borrowing — income multiplied by your chosen multiple.
Monthly repayment — the estimated payment on a capital-and-interest mortgage.
Loan-to-value — the loan as a percentage of the price; lower is generally better for rates.
Deposit percentage — how much of the price your deposit covers.

Example calculation

On a £50,000 household income at 4.5×, estimated maximum borrowing is about £225,000. For a £280,000 home with a £40,000 deposit, you would need a £240,000 loan — slightly above that ceiling, so the tool flags it as tight. A larger deposit or a lower price would bring it back within a typical range.

Remember to budget for the cost of moving itself with the Moving Cost Calculator, and factor your commute into the wider picture using the guide on commute costs and affordability.

Frequently asked questions

What income multiple should I use?

Many lenders work to around 4.5 times income, though some offer more or less depending on your circumstances. We default to 4.5×, but you should treat the result as a rough guide rather than an offer.

How is the monthly repayment worked out?

We use the standard repayment mortgage formula: M = P · r(1+r)ⁿ ÷ ((1+r)ⁿ − 1), where P is the loan, r is the monthly interest rate and n is the number of monthly payments. It assumes a capital-and-interest mortgage at a constant rate.

Why is my real mortgage offer different?

Lenders assess far more than income: your regular spending, other debts, dependants, credit history and stress tests against higher interest rates. Two people on the same income can be offered very different amounts.

What is loan-to-value (LTV) and why does it matter?

LTV is the loan as a percentage of the property price. A lower LTV (a bigger deposit) usually unlocks better interest rates. This tool shows your LTV so you can see how your deposit affects it.