Think carefully before securing other debts against your home. Your home may be repossessed if you do not keep up repayments on your mortgage or any other debt secured on it.
To work out how much you can afford to spend on a home, you need to work out:
Subtract your outgoings from your income to see how much you can pay on a mortgage each month. You can then avoid getting one with repayments you cannot afford.
You can work out how much you can spend on a home by using a mortgage cost calculator. Enter the mortgage amount, interest rate and term to check how much repayments will cost.
Check if you can afford the mortgage by comparing this amount to how much you can afford to pay each month.
There are many other costs when you buy a property, as well as the mortgage. Here is how much buying a home can cost in total.
Lenders have to carefully check your financial circumstances before they can offer you a mortgage. The Financial Conduct Authority's (FCA) rules means they have to make sure you can keep up with the repayments.
To work out how much you can afford to repay, they will look at:
Lenders will also base their decision on:
They also run stress tests to check you could still afford your mortgage if interest rates went up or your circumstances changed, like if you lost your job.
Use our mortgage affordability calculator to check how much lenders are likely to offer.
Add up the following to work out your monthly income:
Use a calculator like Nationwide's budget planner to add up how much money you spend each month.
Alternatively, work out your essential living costs and other spending yourself:
Add up how much you spend in an average month on:
If your income is currently too low to get a mortgage on the property you want, you could wait until your income is higher or try the following:
You should also consider income protection insurance, which could cover your mortgage repayments if you were unable to work due to an accident or illness.
Avoid applying for too many mortgages if you get rejected because this can harm your credit record and make it harder for you to get accepted.
Getting the right mortgage for your circumstances can help you get accepted and come with lower costs than an unsuitable deal. Here is how to work out what type of mortgage is right for you.
You can get mortgages designed for:
Here is how to cut the cost of your:
If you're a first time buyer or looking to move house or remortgage, we can help you find the best mortgage deal to suit your needs.