How much can I borrow?

Posted on 2 April 2010 by nicola stewart


I am a first year mature degree student. I have £40k cash as a deposit and a monthly income of appx £1,000. How much mortgage could I get with a monthly spend of, say, £600 per month?

Nicola

The amount of mortgage you can realise will be determined by your earned income and monthly outgoings. Lenders will look at how much of your income is committed to current outgoings and the proposed mortgage repayment, together with your overall credit standing before deciding how much they will lend to you. Based on the figures provided this will typically be a figure of between £40,000 - £50,000.

Every Lender is under a duty of care to make sure that you do not borrow more than you can realistically repay on both a monthly basis and over the term of the mortgage.

I recommend that you speak to an independent mortgage broker who can advise you on the maximum amount available to you in your own right and who can also explore other ways to obtain a larger mortgage, such as one of your parents acting as guarantor or taking a mortgage in joint names with your parents.

Peter

Answers provided in response to Ask the experts are based on the information provided and do not constitute advice under the Financial Services & Markets Act. They reflect the personal views of the authors and do not necessarily represent the views, positions, strategies or opinions of John Charcol. All comments are made in good faith, and John Charcol will not accept liability for them.

We recommend you seek professional advice with regard to any of these topics where appropriate.

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