Mortgage affordability calculator.
When it comes to mortgages, you want to strike the right balance between borrowing enough for your home and not borrowing so much that the repayments become an issue. And this is where our mortgage affordability calculator comes in.What amount can you afford to borrow for a mortgage?
Simply tell us how much you earn and your monthly expenses, and we'll help you determine how much you can afford to borrow for a mortgage.
When you receive your results, you can adjust the repayment duration and interest rate to better fit any mortgages you are considering applying for. And we'll let you know how much money you'll have left over each month.
How do mortgages work?
If you want to buy a home but don't have the money to pay for it up front, you can apply for a mortgage.
A mortgage is a loan carried out to purchase property or land. It can run from two to forty years, depending on your lender and circumstances.
You'll need at least 5% of the purchase price as a deposit. You then borrow the remainder of the funds (the mortgage) from a lender, such as a bank or building society.
The lender charges interest on the amount borrowed. You then make monthly payments to clear the balance.
The loan is'secured' against the value of your house until it is paid off.
If you can't keep up with your payments, the lender has the right to repossess (take back) and sell your home in order to recover their investment.
What mortgage can I afford?
Typically, you can borrow up to four and a half times your annual salary.
It's tempting to acquire the biggest mortgage available, but consider your finances.
Lenders will examine your income and expenses to see whether you can meet your repayment obligations if circumstances change, such as an increase in interest rates or a change in your income.
Consider how much you can afford to spend each month, keeping in mind that you will also need to cover regular expenses such as energy bills, council tax, insurance, and food.
