We are beginning to see more buyers return to the property market, this is not only being fuelled by a slight reset in property prices but also by mortgage lenders who are continuing to reduce rates across a number of their products.
Our brokers are often asked their opinion of the market. One of the most popular questions we are being asked at the moment is what income multiple lenders are using when deciding to offer a mortgage.
Can I get a mortgage for 5 times my salary?
Mortgage lenders often use income multiples to work out the maximum amount they can loan to you. For example: If your annual gross salary was £30,000 and your lender used an income multiple of 5, you could potentially borrow £150,000.
We work with a number of lenders who are currently lending 5x a borrowers salary. Nationwide’s “Helping Hand” scheme is a good example, allowing First Time Buyers with income over £37,000 single or £55,000 joint to borrow 5.5x their income.
We can also look to support your purchase by utilising products from other lenders. For example, Accord mortgages’ “Boost” product will lend up to 5.5x to borrowers with income over £70,000. Whilst Barclays, HSBC and Halifax all lend up-to 5.5x when certain conditions and criteria restrictions are met.
In addition to the above, we also have access to a niche market for professionals (accountants, solicitors, doctors) who may be able to borrow at better income multiples due to the likelihood that their income will increase over the course of their career.
Maximum income multiples is just one factor, albeit an important one, in ascertaining the level of borrowing available. The lender will also expect the broker to carry out a detailed affordability assessment in order to ensure that borrowers are not over stretching themselves.
Find out how much you can borrow
Contact our award winning brokers to find out how much you might be able to borrow. Get started now by clicking the Schedule a Call button or call and speak to our senior broker, Danny O’Keeffe today on 0208 364 3444.
Five-year fixed rates fall below 6% for first time since October
Borrowers may well breathe a sigh of relief to see that fixed mortgage rates are starting to fall. The average rate for a five-year fixed mortgage has fallen to 5.95 per cent, which is the first time since October that pricing has been below six per cent. By comparison, the average five-year fixed rate as of 20 October was 6.51 per cent says Moneyfacts.
‘Tracker’ mortgage now £973 a month cheaper than fixed-rate deals
The cheapest mortgage rates have fallen to nearly 3pc as borrowers eye up “tracker” deals in anticipation of interest rate falls. Yorkshire Building Society has launched a two-year tracker mortgage at 3.29pc, reduced from 4.15pc and the cheapest of its kind on the market. Rival lender Skipton Building Society has a two-year tracker deal available at 3.39pc.