Mortgage borrowing in the UK can be surprisingly restrictive. As a first-time buyer, the vast majority of products available are limited to 4.5 times the applicant’s annual income. In January 2022, the average UK salary for a full-time worker was around £30,000, equating to a maximum mortgage value of £135,000.
At the same time, average property prices in the UK were hovering at around £274,000 – more than double the maximum mortgage available for a typical first-time buyer.
Consequently, prospective buyers continue to approach brokers with questions on how they can borrow more. Their income level is more than sufficient to cover the monthly repayments of a much larger mortgage, but how can they convince a lender to offer them a larger loan?
7x Salary Mortgages from Specialist Lenders
Away from the High Street, there is an extensive network of specialist lenders who are far more flexible in their mortgage allocation policies. Some of which offer mortgages of up to 7 times the annual salary of the borrower, making home ownership a far more plausible prospect.
Broker support can prove invaluable if you are looking to borrow as much as possible, as the strength of the case you present will determine how much your lender is willing to offer. If your financial status and credit history are both up to scratch, there is a good chance you will be considered eligible for a higher-value with ukpropertyfinance.co.uk
Another option is to submit a joint application with your partner, which could effectively double your spending power. Again, this approach could prove particularly effective when targeting specialist lenders with your mortgage applications.
That being said, not all lenders immediately double their maximum loans values on the basis of a joint application. Policies differ significantly from one lender to the next, which is again where expert broker support can prove invaluable.
Irrespective of the type of mortgage you intend to apply for, the size of the deposit you offer will influence how much you can borrow. It will also have a major impact on the affordability of the facility, determining how much interest you pay and other associated borrowing costs.
Larger deposits pave the way for larger loans and lower interest rates. But as the average deposit requirement for a first-time buyer in the UK is now more than £62,000, meeting even the minimum requirements can be a huge challenge.
Borrow Against Your Business
It is also possible in some instances to borrow more by using your company’s net profits as your income. If you own and operate a successful business, it may be possible to take out a mortgage against your company, rather than yourself.
This is an approach that calls for independent broker support from an early stage, as the application process can be quite complex. However, borrowing as a business (rather than an individual) can often pave the way for preferential interest rates and competitive overall borrowing costs.
It can also be a great way to borrow more than would otherwise be possible, when applying for a conventional mortgage as an individual.
About the Author
Craig Upton supports UK businesses by increasing sales growth using various marketing solutions online. Creating strategic partnerships and keen focus to detail, Craig equips websites with the right tools to rank in organic search. Craig is also the CEO of iCONQUER, a UK based SEO company and has been working in the digital marketing arena for many years. A trusted SEO consultant and trainer, Craig has worked with British brands such as UK Property Finance, Serimax, djkit and also supported UK doctors, solicitors and property developers, gain more exposure online. Craig has gained a wealth of knowledge using Google and is committed to creating new opportunities and partnerships.
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