How Much Can you Borrow? | Equinox Mortgages

Before starting your property search, it’s essential to know your borrowing potential. Understanding this not only saves you time but ensures that when you find your ideal home, you’re well-prepared and know exactly what’s within reach. At Equinox Mortgages, we help you determine your borrowing capacity by conducting a thorough mortgage eligibility assessment—taking into account all your income sources and any influencing factors.

Estimating Your Maximum Borrowing Potential

When it comes to borrowing for a mortgage, every lender calculates your maximum amount slightly differently. Typically, lenders use income multiples to determine this amount, generally offering between 4 and 6 times your annual income, though certain factors can impact this multiple. At Equinox Mortgages, we conduct a detailed assessment to understand your income, spending, and lifestyle—helping us to match you with the lenders most likely to offer you the maximum amount you qualify for.

A Whole-of-Market Approach for Greater Flexibility

With access to the whole market, we can approach a broad range of lenders, each with unique criteria that may align with your specific financial situation. This includes high street banks like Barclays, HSBC, NatWest, as well as specialist lenders like Kensington Mortgages, Bluestone, and Aldermore. By choosing Equinox, you benefit from Josh’s extensive network and experience finding options that offer the best terms, rates, and borrowing limits for each client.

What Affects Your Income Multiple?

Several factors can influence the income multiple a lender offers you, including:

Income Stability: Those with a steady income or a longer employment history often qualify for higher multiples.
Debts: Outstanding loans, credit cards, and other debts may lower your borrowing capacity, as lenders want to ensure you can meet both mortgage payments and other financial commitments.
Dependents: Children or other dependents can impact how much you can borrow, as lenders consider them when evaluating your financial obligations.

At Equinox, we work to find lenders who are willing to be flexible with these factors, so you get the best outcome possible.

Types of Income That Lenders May Consider

Each lender has its own criteria for considering income types beyond basic salary. Here are some examples of what may be used to support your borrowing:

Base Salary: Your annual salary forms the core of your borrowing limit.
Bonuses & Overtime: Lenders vary on how much of your bonus or overtime pay they consider, with some accepting 50% or even the full amount if it's regular.
Area Allowances: If you receive a location-specific allowance (e.g., London allowance), some lenders will include this as additional income.
Self-Employment: Many lenders consider self-employed income based on your business’s average profit over the last 2 years, though criteria differs, and some will be more flexible with short trading histories.

Equinox will identify the best lender for your income profile, ensuring they review your finances in a way that maximises your borrowing potential.

Why Do This Early?

It’s essential to determine your borrowing capacity before you start offering on properties. By understanding your budget ahead of time, you avoid disappointment or delays and increase your confidence when negotiating on a property.

Ready to Explore Your Borrowing Options?

Get in touch with Josh at Equinox Mortgages, where we’ll discuss your income sources, financial commitments, and lifestyle needs. Together, we’ll conduct an in-depth assessment, helping you find the right lender and achieve the maximum borrowing possible. Knowing exactly what you can afford not only saves time but sets you up for success in your home-buying journey. 🌓