If you’re earning £70,000 per year, buying a home might feel like a more achievable goal. However, the key question remains: how much mortgage can you get?
Mortgage lenders don’t just look at your income—they also evaluate your overall financial health, including existing commitments, deposit size, and creditworthiness. In this guide, we’ll explore how much you can potentially borrow, what factors influence mortgage affordability, and ways to increase your borrowing power.
How Much Can You Borrow on a £70,000 Salary?
Most UK lenders apply an income multiple of between 3.5 and 5 times your annual salary to determine borrowing capacity.
- 3.5x salary: £245,000
- 4x salary: £280,000
- 4.5x salary: £315,000
- 5x salary: £350,000 (available from select lenders)
These figures serve as general estimates, but actual lending decisions depend on additional factors, including affordability assessments, existing debts, and financial stability.
Key Factors That Influence Mortgage Affordability
Beyond salary, lenders assess multiple aspects of your finances to determine what you can afford.
1. Outstanding Debt and Financial Commitments
If you have ongoing financial obligations such as car finance, credit cards, or student loans, lenders will factor these into affordability calculations. Reducing debt can boost the amount you’re eligible to borrow.
2. Credit Score and History
A higher credit score generally allows access to better mortgage rates and terms. If your credit history includes late payments or defaults, lenders may reduce the amount they’re willing to lend.
3. Living Expenses and Lifestyle Costs
Your monthly expenses, including rent, bills, and discretionary spending, impact your mortgage affordability. Cutting back on non-essential spending can improve your financial profile.
4. Deposit Size and Loan-to-Value (LTV) Ratio
A larger deposit lowers your LTV ratio, which can reduce monthly payments and unlock better mortgage deals. A smaller deposit may mean higher interest rates and stricter lending conditions.
5. Employment Stability and Income Consistency
Lenders favour applicants with a stable, consistent income. If you’re self-employed, providing tax returns and business accounts may be necessary to prove earnings.
Example Scenario: Home Purchase on a £70,000 Salary
If you earn £70,000 annually, have a 10% deposit, and minimal financial liabilities, your home-buying potential may look like this:
- Loan amount (4.5x salary): £315,000
- Deposit (10% of property price): £35,000
- Estimated home price: £350,000
Your exact mortgage offer depends on lender criteria and individual affordability assessments.
The Importance of Your Deposit
Your deposit plays a crucial role in shaping mortgage affordability and interest rates:
- 5% Deposit (£17,500) – Higher monthly repayments, limited lender options.
- 10% Deposit (£35,000) – Access to better rates and mortgage choices.
- 20%+ Deposit (£70,000+) – Best mortgage deals with lower borrowing costs.
A larger deposit improves affordability and enhances lender confidence in your financial stability.
Government Schemes to Assist Buyers
If saving for a deposit is a challenge, consider government-backed home ownership schemes:
- Help to Buy Equity Loan – Provides a 20% loan (40% in London) for new-build homes with a 5% deposit.
- Shared Ownership – Allows partial property purchase with rental payments on the remaining share, with options to increase ownership over time.
- First Homes Scheme – Offers 30-50% discounts on selected new-build properties for first-time buyers and key workers.
These schemes help buyers access homeownership with reduced upfront costs.
Steps to Increase Your Mortgage Borrowing Potential
To boost your mortgage affordability, consider the following strategies:
- Reduce Outstanding Debt – Paying off credit cards and personal loans improves affordability.
- Enhance Your Credit Score – Ensure on-time bill payments, reduce outstanding balances, and correct any credit report errors.
- Save a Larger Deposit – A bigger deposit unlocks better mortgage terms and lower monthly repayments.
- Consider a Joint Mortgage – Partnering with a spouse or family member can increase combined borrowing power.
- Work with a Mortgage Broker – Mortgage brokers can connect you with lenders offering higher income multiples and flexible terms.
Additional Costs to Prepare For When Buying a Home
In addition to your mortgage repayments, factor in these extra home-buying costs:
- Stamp Duty – First-time buyers in England and Northern Ireland pay no Stamp Duty on properties up to £425,000.
- Legal Fees and Conveyancing – Covers property searches and legal paperwork.
- Mortgage Arrangement Fees – Some lenders charge fees for setting up a mortgage.
- Survey and Valuation Costs – Essential to assess the property’s value and condition.
- Insurance and Moving Expenses – Includes home insurance, removals, and furnishing costs.
Planning ahead for these expenses ensures a smooth home-buying process without financial surprises.
Choosing the Right Mortgage Type
Selecting the best mortgage depends on your financial situation and risk tolerance. Here are the most common types:
- Fixed-Rate Mortgage – Keeps interest rates constant for a set term, ensuring stable payments.
- Tracker Mortgage – Tied to the Bank of England base rate, meaning payments fluctuate.
- Interest-Only Mortgage – Lower initial payments but requires a repayment strategy for the loan principal.
- Variable-Rate Mortgage – Interest rates change over time, affecting monthly repayments.
Carefully consider which option best aligns with your financial goals and long-term plans.
Final Thoughts: Can You Buy a Home on a £70,000 Salary?
A £70,000 salary provides a strong foundation for homeownership, but your exact mortgage offer depends on deposit size, outstanding debts, and lender policies.
With good financial planning, a strong credit profile, and a sufficient deposit, you could qualify for a mortgage in the range of £245,000 – £350,000.
For tailored mortgage advice and access to the best mortgage deals, working with a mortgage broker can help streamline the home-buying process and ensure you secure the most suitable loan for your needs.
