Want to know if you can get a mortgage based on 6 times your salary? Well that depends on your income, circumstances and the lender assessing your application.
In this guide, we’ll look at getting a mortgage based on 6x your annual salary, what factors affect maximum borrowing and what you need to be aware of when borrowing at this level. That way, you can start the moving home journey with a clearer idea of your options.
In this Guide, We Will Cover the Following Topics:
- What Is a 4 - 4.5x Salary Mortgage?
- Are Mortgages Always Based on 4 or 4.5 Times Salary?
- What Affects Borrowing Limits?
- Which Mortgage Lenders Offer 4 and 4.5 Salary Multiples?
- How Do 4.5 Times Salary Mortgages Work if You Are a Joint Applicant?
- How Much Deposit Do I Need for Mortgage Borrowing 4 - 4.5 Times Income?
- Can I Get a 4.5x Salary Mortgage with Bad Credit?
- How Can I Improve My Chances of Approval for a 4.5x Salary Mortgage if I Have Bad Credit?
- Can Self-Employed People Get a 4.5x Income Multiple?
- What Income Multiples Are Available to First-Time Home Buyers?
- Summing Up
What Are Mortgage Income Multiples?
As part of their mortgage affordability assessment, a lender will use a calculation known as a mortgage income multiple to work out the maximum amount an applicant can borrow on their mortgage.
The lender will essentially multiply your annual income (or salary if you’re employed) by their chosen income multiple. The most common multiple used by lenders is 4.5. This means that if an individual earns £50,000 per year, they may be able to get a mortgage of up to £225,000 (as 50,000 x 4.5 = £225,000). Lenders will apply an income multiple to the income of all mortgage applicants, resultantly you can typically borrow more when you apply with a partner or family member.
For example:
- You earn £50,000
- Your partner earns £40,000
- The lender uses an income multiple of 4.5
- Your maximum borrowing is: 4.5 x (£50,000 + £40,000) = £405,000
Once lenders have worked out your maximum borrowing using an income multiple, they will consider other factors to determine your overall affordability, what they can actually lend to you and what deal they can offer. These factors include: your monthly income and outgoings, your credit profile, debt, age, deposit and more.
Can You Get a Mortgage Based On 6 Times Salary?
Mortgage borrowing at 6 times your income is possible, but it depends on the lender's criteria and your situation.
The lenders that do lend at 6x income will typically only consider this if you meet one or more of the following requirements:
- You have a particularly high income or net worth
- Your future income is likely to increase due to your profession – for a example, a lawyer or doctor
- You have additional sources of income
- You have a large deposit of 40% or more
In addition to you meeting the lender’s income and deposit requirements they will likely also expect an excellent credit history, low amount of debt, a suitable property as security and more.
This isn’t just true for high income multiples. You’re more likely to have a mortgage or remortgage application approved if you strive to meet these general requirements – but bear in mind every lender has their own criteria, so one lender may be able to offer you a better deal based on your circumstances than another.
How to Calculate How Much You Can Borrow
For an estimate of your maximum borrowing, you can use our how much you can borrow calculator. This calculator uses an income multiple of 4.5.
If you would like to calculate how much you can borrow using an income multiple of 6, simply multiply your annual income by 6 – e.g. £100,000 x 6 = £600,000. Bear in mind that few lenders will consider lending 6x your income, and those that do will have strict requirements you must meet in order to be eligible.
Once you’ve established your maximum borrowing, you can then compare moving home deals or first-time buyer mortgage rates on the market and calculate your mortgage repayments based on the information you’ve gathered.
Of course, these calculators and best buys can only give you an idea of the kind of deal available to you. Get in touch with us on 0330 433 2927 to speak with a broker who can consider your situation and explain exactly what your options are.
How to Borrow 6 Times Annual Salary
Applying for a mortgage of 6 times your salary/income in the UK is possible, but it depends on the lender's criteria and your situation.
Lenders that will consider lending at higher income multiples will have certain requirements such as those laid out below.
Consider Your Income
Lenders will look at your income and employment history to determine if you have a stable source of income that can support the mortgage payments. In order to qualify for a mortgage of 6x your income, you will typically need to be a higher earner or the future potential to be one – e.g. you’ve recently qualified as a doctor or lawyer.
Improve Your Credit Profile
Lenders look at your credit history to essentially see how reliably you manage your credit and finances. This indicates to them how likely it is that you'll make your mortgage payments on time.
An excellent credit history can go a long way in securing a good deal, so it’s especially important if you want to borrow at a particularly high income multiple.
You’ll find your mortgage options limited if you have a history of adverse credit such as late mortgage payments or bankruptcy.
Learn about improving your credit score here.
Not all lenders will consider lending at 6x your income, even if you meet all the listed criteria. For the best chance of finding a lender that can cater to your needs and consider using a higher income multiple, speak to a mortgage broker like John Charcol. We’ll be able to tell you if you’re eligible and which lender has the right deal for you.
Improve Debt-to-Income Ratio
This measures how much of your income is going towards paying off debt. Lenders look at this ratio to determine how much of your income you have available for your mortgage repayments. A high ratio may indicate that you have too much debt and may struggle to maintain the mortgage payments. Consider reducing your debt and outgoings before applying for a mortgage to maximise your borrowing power.
Build Up Your Deposit
Lenders will also consider the size of your mortgage deposit. Typically the bigger the deposit, the better the deals available to you.
A lender may consider allowing you to borrow up to 6x your income if you have a particularly large deposit, such as 40% or more.
Which Lenders Offer Mortgages 6 Times Salary?
Not all lenders offer mortgages at 6x your income.
As of November 2023, the following lenders offer 6x salary mortgages:
- Hodge
- Kensington Mortgages
- Teachers Building Society
The following mortgage lenders specify that they don't have a maximum income multiple (although this doesn't necessarily mean they will go to 6 or above, they simply have a different way of calculating the maximum loan amount):
- Livemore
- Norton Home Loans
- Penrith
- Together
- Central Trust Limited
- Market Harborough Building Society
- Newcastle Building Society
What Types of Income Are Considered for a 6 Times Salary Mortgage?
When applying for a mortgage with a multiple of 6 times income, the lender will typically consider your gross annual income before taxes. This income can come from a variety of sources, including:
- Employment income - this includes salary, wages and bonuses from your full-time or part-time job. Some lenders may require you to have been employed for a certain length of time before approving a mortgage
- Self-employment income - if you're self-employed, lenders will consider your income from your business. They may require additional documentation, such as tax returns, to verify your income
- Rental income - rental income can also be considered when determining your maximum mortgage if you own rental properties
- Investment income - some lenders may also consider other types of income, such as interest from savings accounts or dividends from investments
- Additional income - some lenders may take into account other types of income, such as from a pension, child support, or maintenance payments
The lender will typically only consider the income that can be verified, is stable and is likely to continue.
If you have multiple income sources or simply want to know which lenders can consider certain income streams speak to a one of our advisers on 0330 433 2927. We’re familiar with lenders across the market and their criteria, so feel reassured we can point you towards the lender with the best deal for you.
Can I Get A Mortgage 6 Times Salary Based On Joint Income?
It's possible to get a mortgage at 6 times salary based on your joint income, but it depends on the lender's guidelines and policies, as well as the income of both borrowers.
What Is The Minimum Deposit Required for a 6 Times Income Mortgage?
The minimum deposit required for a mortgage with a multiple of 6 times income varies depending on the lender or your income.
If you have a particularly high income or future earning potential, some lenders may consider lending to you at up to 6x your income even if you only have a deposit of 10%.
Alternatively, if you have a closer to average income but a particularly high deposit for a mortgage, such as 40% or more, some lenders may also consider lending to you at up to 6x your income.
Are There Downsides of Mortgages Using Higher Income Multiples?
When you borrow at a higher income multiple, such as 6x your salary, there are positives and negatives. Of course, you’re able to borrow more and perhaps secure a nicer property. On the other hand you may face:
- Higher monthly payments - a higher mortgage amount will likely mean higher monthly payments, which can put a strain on your budget and make it harder to afford other expenses
- Greater risk of default - borrowing a larger amount of money also increases the risk of defaulting on the mortgage. If you cannot make the monthly payments, you could lose your home to foreclosure
- Higher interest rate - lenders may charge a higher interest rate for larger mortgages, which can increase the overall cost of the loan
- More interest paid overall – if you borrow more money over the same term, you’ll pay more interest. This is because interest is worked out using the outstanding mortgage amount (which will be greater on a larger loan)
Whether it’s a good idea for you to borrow at up 6x your income will be down to your situation. The lender will run all sorts of checks to determine whether it’s a suitable option for you. Your mortgage broker will also give you bespoke advice to ensure you make the right decision for your circumstances.
Is It Possible To Borrow More Than 6 Times Your Salary?
It is possible to borrow more than 6 times your salary, but highly unlikely. This would only be possible in very special circumstances.
Ready to Get a Mortgage Based on Up to 6 Times Your Salary?
Lenders use income multiples to determine how much you can afford to borrow. While 4 and 4.5 times your salary are the most common multiples, it is possible to get a mortgage based on 6 times your income – but only if you meet certain criteria such as having a particularly high earning potential.
Find out if borrowing at up to 6x your income is an option for you by getting in touch with an expert mortgage broker on 0330 433 2927. Our advisers have extensive knowledge of the mortgage market and work with lenders to find the best deals for borrowers, so we’ll be able to consider your situation and give you advice on your next steps.