What this calculator works out
This calculator multiplies your household income by a lending multiple and adds your deposit, producing an indicative borrowing figure and property budget.
It is a first-pass estimate, and deliberately so. A lender's decision rests on affordability testing, credit history and stress-testing against higher interest rates — none of which any public calculator can reproduce. Use this to find the right ballpark before you speak to a broker, not to set your heart on a figure.
Enter your details
Before you rely on the figure
- Use gross annual income before tax, and only income a lender will actually count. Guaranteed overtime and regular bonuses may be included in part; irregular income often is not.
- Set the multiple realistically. Around 4 to 4.5 times income is typical; some lenders stretch further for higher earners or specific professions, and some lend less.
- Enter the deposit you will genuinely have left after fees, not your total savings. Legal costs, surveys and moving expenses come out of the same pot.
- Subtract nothing for existing commitments here — but be aware that loans, car finance, credit card balances and childcare all reduce what a lender will offer.
Lenders apply an income multiple as an upper limit, then run a full affordability assessment on top of it. A household passing the multiple can still be declined on affordability, and the stress test — checking you could still pay if rates rose substantially — is often what binds.
How this calculator works
Two straightforward steps:
Estimated loan = (income 1 + income 2) × income multiple
Indicative property budget = estimated loan + depositThe property budget is what you could offer, not what you can afford to run. Stamp duty, legal fees, surveys and moving costs sit on top and are paid from the same savings as the deposit.
The deposit also affects the rate you are offered. Loan-to-value bands typically step at 95%, 90%, 85%, 80% and 75%, and crossing a band downwards can reduce your interest rate noticeably.
Worked example: a joint application
Using the default figures — incomes of £40,000 and £25,000, a 4.5 multiple and a £30,000 deposit:
- Combined income: £65,000
- Estimated loan: £65,000 × 4.5 = £292,500
- Indicative property budget: £292,500 + £30,000 = £322,500
At that budget the deposit is 9.3% of the purchase price, which puts the application in the 90–95% loan-to-value band where rates are highest. Buying at £300,000 instead would make the deposit 10% and move into a cheaper band — and would leave more of the savings intact for the £9,000 or so of moving costs that this figure does not include.
Common mistakes
- Treating the property budget as the affordable price. Fees, stamp duty and moving costs come out of the deposit.
- Ignoring existing debt. Loan and car finance payments directly reduce what a lender will advance.
- Including income a lender will discount. Non-guaranteed overtime, commission and second-job income are often only partly counted.
- Making multiple full applications. Each leaves a hard search on your credit file; use an agreement in principle instead.
- Forgetting the running costs. Service charges, ground rent, insurance and maintenance are not part of the mortgage payment.
Frequently asked questions
How much deposit do I actually need?
5% is the usual minimum for a standard residential mortgage, but the rate improves at each loan-to-value band, and the difference between 5% and 10% down is often substantial across a whole fixed-rate period. If you are close to a band boundary, a slightly smaller purchase or a slightly larger deposit can be worth more than it looks.
Why might a lender offer less than this suggests?
Affordability testing. Lenders assess your committed outgoings, dependants, and whether you could still pay if rates rose by several percentage points. Credit history matters too. Self-employed applicants are usually assessed on two or three years of accounts, and a recent drop in profit can reduce an offer considerably.
Does a bigger deposit or a longer term help more?
A bigger deposit reduces the loan and usually the rate, so it saves money in every direction. A longer term reduces the monthly payment but increases total interest substantially — and lenders will not extend a term past a reasonable retirement age. Extend the term only if you need to, and overpay later when you can.
Should I use a broker?
Usually worth it, particularly for a first purchase, self-employment, adverse credit or anything unusual. Brokers see lending criteria that are not published, and many are paid by the lender rather than by you. Check how yours is paid before you commit.
Is my income information stored?
No. Everything you enter is processed in your browser and is never transmitted or retained as a record.
Related tools
References
- MoneyHelper — guidance on mortgages, deposits and what lenders assess
- Financial Conduct Authority — mortgage affordability and responsible lending rules
- GOV.UK — government schemes for first-time buyers and homeowners
Sources are checked at publication and can change — how I choose and check references.