There is no single figure for how much you can borrow, because every lender applies its own rules. What you can do is run the two tests most of them have in common: a multiple of your income, and a payment check that asks whether you could still afford the mortgage at a higher interest rate. The lower result is your limit. On a £60,000 salary with sensible default assumptions, the illustrative figure is £270,000.
Here is how each test works, a worked example you can reproduce, and what moves the answer.
How do lenders decide how much you can borrow?
Two checks run side by side:
- An income multiple. Borrowing is capped at some number of times your annual income. Lenders set their own multiples, and they can differ with your income, deposit, credit history and the product.
- An affordability assessment. The lender works out whether you could pay the mortgage after your other spending, and whether you still could if rates rose.
The second is a regulatory requirement, not just a lender preference. The FCA’s mortgage rules (MCOB 11.6) require a lender to assess whether you can afford the payments, taking account of your income, your credit and other contractual commitments, your essential household spending and your basic quality-of-living costs. The rules also require lenders to consider the effect of likely future interest rate rises.
Neither test is “the” answer. If your income multiple would allow £300,000 but your budget only supports £250,000 at a higher rate, £250,000 is where you stop.
What counts as income, and what counts against it?
Income is the starting point, but not every pound counts equally. Basic salary is usually the simplest. Overtime, bonuses, commission and self-employed profit are often treated more cautiously, for example by averaging them over several years or counting only part of them. The calculator below lets you choose what share of variable income to include, so you can test a cautious view.
One difference to keep in mind: the FCA rules refer to income net of income tax and National Insurance, while the calculator below uses gross income, as the multiple does. To see what your pay looks like after deductions, use the UK take-home pay calculator.
Commitments are what come off the top. Loan repayments, car finance, credit-card minimums, buy-now-pay-later plans, child maintenance and Student Loan repayments that will continue after you buy all reduce what is left for a mortgage. So do essential costs such as food, utilities, transport and Council Tax, and owner-only costs such as buildings insurance and a service charge.
What is a stress test, and why does it matter?
A stress test checks that you could still pay if your rate went up. Under MCOB 11.6.18R, a lender must take account of likely future interest rate increases over at least five years, unless your rate is fixed for longer than that. The FCA’s handbook text also requires the lender to assume a rise of at least 1 percentage point over that period. Beyond that minimum, lenders choose their own method, and the Financial Policy Committee’s earlier stress-test recommendation was withdrawn in August 2022.
So the stress rate a lender uses is not something this article can state. The calculator treats it as a planning assumption you choose, set above your mortgage rate. The point is the same: a deal at 5% is tested as if it were dearer, and the monthly payment at that higher rate is what has to fit your budget.
A worked example: £60,000 income, £40,000 deposit
These are the calculator’s opening figures, so you can reproduce every number below.
| Input | Figure |
|---|---|
| Basic income, single applicant | £60,000 |
| Total deposit | £40,000, with £5,000 kept for buying costs |
| Monthly commitments | £500 |
| Essential household costs | £1,500 |
| Owner-only costs | £250 |
| Mortgage rate, term | 5%, 25 years |
| Stress rate | 7% |
| Income multiple | 4.5× |
| Monthly safety buffer | £500 |
Test 1, the income multiple. £60,000 × 4.5 = £270,000.
Test 2, the payment check. Gross monthly income is £60,000 ÷ 12 = £5,000. Take off £500 of commitments, £1,500 of essentials, £250 of owner costs and the £500 buffer, and the monthly payment budget is £2,250. The largest loan that £2,250 a month repays at 7% over 25 years is £318,346.
The result. The lower of £270,000 and £318,346 is £270,000. Add the £35,000 deposit left after the reserve and the illustrative property price is £305,000, a loan of 88.5% of the price.
The monthly payment on £270,000 is £1,578.39 at 5% and £1,908.30 at 7%. Even at the stress rate, £341.70 is left after the £500 buffer, so the budget holds up.
What changes your borrowing limit?
Changing one figure at a time in the same example shows which test is doing the work:
| Change | Illustrative limit | Test that sets it |
|---|---|---|
| Nothing (4.5×) | £270,000 | Income multiple |
| Multiple of 4× | £240,000 | Income multiple |
| Multiple of 5.5× | £318,346 | Payment check (the multiple alone would give £330,000) |
| Commitments of £1,000 a month | £247,602 | Payment check |
| Joint, second £30,000 income | £405,000 | Income multiple |
Two things stand out. First, a higher multiple only helps up to the point where your budget runs out: at 5.5× the payment check, not the multiple, sets the limit. Second, £500 a month of extra commitments costs about £22,400 of borrowing in this example, which is a bigger swing than a half-point on the multiple.
Try it with your own figures
Enter your own income, deposit, costs, rate and stress rate below. It opens on the £60,000 example above, so the first thing to try is changing the commitments figure and watching the limit move.
Your illustrative UK mortgage affordability range
Based on gross household income, monthly costs, deposit and mortgage assumptions you entered. This is not a mortgage offer, approval decision or affordability assessment.
Your selected income multiple produces the lower illustrative borrowing limit under these inputs.
Lenders may use different income treatment, spending assumptions, stress tests and credit criteria.
Borrowing calculation
| Usable annual household income | £60,000 |
|---|---|
| Gross monthly income equivalent | £5,000.00 |
| Indicative income multiple | 4.5× |
| Income-multiple borrowing ceiling | £270,000 |
| Monthly payment budget after entered costs/buffer | £2,250.00 |
| Loan supported at current rate | £384,885 |
| Stress-rate payment ceiling | £318,346 |
| Illustrative borrowing limit | £270,000 |
Usable annual income = £60,000 + (£0 × 0%) = £60,000 + £0 = £60,000.
Deposit and property price
| Total deposit | £40,000 |
|---|---|
| Buying-cost reserve | £5,000 |
| Deposit toward property price | £35,000 |
| Illustrative mortgage borrowing | £270,000 |
| Illustrative property price | £305,000 |
| Illustrative loan to value | 88.5% |
Monthly planning
| Gross monthly household income equivalent | £5,000.00 |
|---|---|
| Existing monthly commitments | £500.00 |
| Essential household costs | £1,500.00 |
| Owner-only property costs | £250.00 |
| Mortgage payment, current rate | £1,578.39 |
| Remaining before safety buffer | £1,171.61 |
| Chosen safety buffer | £500.00 |
| Remaining after safety buffer | £671.61 |
| Mortgage payment, stress rate | £1,908.30 |
| Remaining before safety buffer, stress rate | £841.70 |
| Chosen safety buffer | £500.00 |
| Remaining after safety buffer, stress rate | £341.70 |
Gross monthly income is annual household income divided by 12. It is not take-home pay and does not include tax, National Insurance, pension, Student Loan or other payroll deductions.
Test your property price
| Property price tested | |
|---|---|
| Usable deposit | |
| Mortgage required | |
| Deposit percentage | |
| Loan to value | |
| Payment at current rate | |
| Payment at stress rate | |
| Remaining after buffer, current rate | |
| Remaining after buffer, stress rate |
This does not confirm mortgage affordability, lender eligibility or approval.
Enter a property price above under "Test a property price" to see the mortgage, deposit percentage and payments it would imply.
How mortgage-rate assumptions change the payment
Scenarios built from the rates you entered, not a forecast of future rates.
| Scenario | Rate | Monthly payment | Remaining after costs and buffer |
|---|---|---|---|
| Current rate | 5% | £1,578.39 | £671.61 |
| Current rate + 1 percentage point | 6% | £1,739.61 | £510.39 |
| Stress rate | 7% | £1,908.30 | £341.70 |
Why is the borrowing limit not the same as what you should borrow?
A limit tells you what a lender might consider. It says nothing about what you are comfortable paying. A few things the limit does not cover:
- The rate you actually get. The calculator uses the rate you enter. Real deals vary with your deposit and the lender, and many fixes end after two to five years, when the payment is recalculated. When you compare products, look at the APR, which includes compulsory fees, as well as the headline rate.
- Costs beyond the mortgage. Stamp Duty, legal fees, surveys and moving costs come out of your deposit. Use the stamp duty calculator, or read how stamp duty works for first-time buyers.
- How the debt shrinks. On a repayment mortgage, early payments are mostly interest and reduce the principal slowly, a pattern called amortisation. The article on how a mortgage repayment is calculated works through it.
- Your own safety margin. The £500 buffer in the example is a choice. A lender’s pass is not a promise that the payment will feel comfortable.
None of this predicts approval. Lenders verify your income, check your credit file and look at the property, and none of that is visible to a calculator. Treat the result as a planning range, and take the figures to a lender or a mortgage adviser for a decision.
What to do next
Work out the monthly payment on a specific price with the mortgage repayment calculator, then run your own figures through the affordability calculator above, once with your real commitments and once with the cautious version of your income. If the two limits are far apart, that gap is the thing to understand before you speak to a lender.
Frequently asked questions
How much can I borrow for a mortgage on a £60,000 salary?
Do lenders use income multiples or affordability checks?
Does my deposit change how much I can borrow?
Do existing debts reduce how much I can borrow?
Can I borrow more on a joint mortgage?
Sources: FCA Handbook: MCOB 11.6 Responsible lending and financing, FCA: Interest rate stress test rule.
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