Jump to content
House Price Crash Forum
Sign in to follow this  
selhurst sound

Affordability Vs Salary Multipliers

Recommended Posts

Since the introduction of the MMR rules, are lenders tending to lean more towards affordability over multipliers?

I'm a homeowner (jointly with partner) looking to move somewhere bigger next year and the mortgage we'd be looking for would be 5-5.5 x our joint income, which of course is high. On the affordability front, based on current rates we seem to be able to afford it comfortably with around £2k to spare after deducting the new mortgage payment, council tax, debt (only sofa on finance). We do have one child, but no childcare costs. Appreciate other lifestyle expenditure will be looked at, but I wouldn't say we pay anything above average on that front either.

We'd also be looking at a LTV of just under 90%, which I appreciate is also not in our favour.

So, are we better off to start planning for this not to happen or is it worth enduring the mortgage interview when the time comes?

Share this post

Link to post
Share on other sites

Thanks Wurzel. Quick recalculation looks like leaving us around £1300 with the rate at 7%.

Any idea what lenders are looking for in terms of free income criteria these days? Back when I used to deal with these things I think £700 used to be ok, but I dare say that's increased by now!

Share this post

Link to post
Share on other sites

When I went to Halifax to look at remortgaging, they offered 4 x my salary and took travel and childcare costs into affordability, not a lot else and noted to us that they would not be looing into 'lifestyle' costs. This was with 60% LTV.

The full list is below:

Share this post

Link to post
Share on other sites

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now
Sign in to follow this  

  • Recently Browsing   0 members

    No registered users viewing this page.

  • The Prime Minister stated that there were three Brexit options available to the UK:   205 members have voted

    1. 1. Which of the Prime Minister's options would you choose?

      • Leave with the negotiated deal
      • Remain
      • Leave with no deal

    Please sign in or register to vote in this poll. View topic


Important Information

We have placed cookies on your device to help make this website better. You can adjust your cookie settings, otherwise we'll assume you're okay to continue.