Finding out how much you can borrow to buy a home is often the first question on many home buyers’ minds. Despite the myths, there’s no set rule for the amount you can borrow - it depends on a number of factors, just one of which is your salary.

That may come as good news for some, as a higher salary doesn’t automatically mean you can borrow more. What it does mean is that your overall financial profile will help lenders decide how much they’re willing to lend, and your salary will make up a part of that profile.

Don’t automatically assume you can borrow five times your salary

If you’re a first-time buyer, you may have heard people say that you can borrow five times your salary. This isn’t automatically the case! While being able to borrow five times your earnings used to be the general rule of thumb, the regulatory rules around lending for mortgages changed in 2014 following the financial crisis.

Interest rates are currently low but they’re expected to rise in November, and may continue to go up over the next few years. Lenders therefore have to assess whether you’d be able to afford your mortgage repayments if the base rate increased. As a result, affordability checks now cover more variables than just your salary.

Lenders will want to see your outgoings as well as your income so they can build up a picture of your financial situation. Your monthly spending habits indicate how much you’d be able to afford to repay each month. If you have lots of financial commitments, such as expensive car payments, school fees, or childcare costs, you may not be able to borrow as much as you’d expect.

Although there’s no guarantee that you can borrow five times your salary, many people find that they can borrow between three and five times what they earn. There’s no ‘one size fits all’ when it comes to borrowing for your mortgage - different lenders may be prepared to offer varying amounts.

The importance of your credit history

Lenders also take into account your credit history. They’ll want to see evidence that you’re trustworthy and have a history of repaying borrowed cash. Whatever your salary, having a good credit score will put you in a better position to borrow more for your mortgage.

Online mortgage calculator

Online mortgage calculators like this one can give you an estimate of the amount you’ll be able to borrow and are a helpful starting point. Because these calculators don’t take into account any of the affordability criteria you’ll be checked against, you shouldn’t take the amount you’re shown as a guarantee.

See what you could afford with a Mortgage in Principle

It’s a good idea to get a Mortgage in Principle before you start your search for a new home so you know your budget. Find out how to get a Mortgage in Principle with Trussle.