Getting a mortgage isn't only about your income. Lenders want to understand how you live, what you spend, and whether your finances can withstand financial difficulties.
This guide explains how affordability checks work, why two lenders might give you very different figures, and what you can do if the number you're offered feels too low.
1. What lenders look at
Lenders all start in the same place:
What comes in, what goes out, and what's left over.
They'll assess:
- Income – salary, bonuses, overtime, self-employed profit
- Regular spending – food, utilities, transport
- Committed costs – loans, credit cards, childcare, maintenance
- Future costs – council tax, service charges, rising bills
The goal is simple: can you keep up payments without stretching yourself to breaking point?
Most lenders use an income multiple (often between 4× and 5.5× your income), but this is heavily shaped by your outgoings. Two people earning £40,000 can end up with completely different borrowing limits.
2. Stress Testing: Could you still afford it if rates rise?
Since 2014, UK lenders have been required to "stress test" your mortgage, even after the formal rules were relaxed, most lenders kept the habit.
A stress test asks:
"If interest rates rose by a few percentage points, could you still afford the monthly payment?"
If the answer is no, your borrowing amount drops.
This is why a lender might approve your mortgage in principle at a certain level, then reduce it once the full application begins. The higher the rate environment, the tougher the test becomes.
3. How dependants, loans and childcare costs affect borrowing
These costs matter more than people expect. They directly reduce the "spare" income lenders use to calculate what you can borrow.
Dependants
Children increase your monthly spending assumptions: food, travel, clothing, school costs.
More dependants = higher costs = lower borrowing.
Loans and Credit Cards
Outstanding loan balances reduce your maximum loan immediately.Monthly repayments count as committed spending.
Credit card limits matter, some lenders assume a percentage of your limit is used each month.
Paying down a loan can sometimes increase your mortgage affordability by more than the amount you repay.
Childcare
One of the biggest affordability limiters.
Nursery, after-school clubs, and holiday care all count as committed spending. Some lenders take the full annual cost, even if it varies month to month.
4. Why two lenders offer different amounts
It's frustrating when one lender says you can borrow £300,000 and another says £235,000, but it's normal.
Differences come from:
- Risk appetite – some lenders are more conservative
- Income treatment – one may accept full overtime; another might ignore it
- Loan-to-income caps – some cap at 4.49×, some go up to 5.5×
- Childcare assumptions – wide variation
- Credit scoring – each lender uses its own internal score
- Stress test rates – not all lenders test at the same level
A mortgage adviser can compare these quickly because they know how each lender treats your finances.
5. How to improve your affordability
Small changes can shift your borrowing amount more than you'd expect.
- Tidy Up Your Credit
- Pay down credit cards
- Close unused accounts
- Fix errors on your credit file
- Avoid new credit in the months before applying
- Reduce Monthly Commitments
If possible:
- Repay small loans
- Lower car finance costs
- Consolidate expensive debt (only if appropriate for you)
- Be Realistic With Spending
- Lenders use their own assumptions, but they'll still look at your bank statements. Three months of cleaner, steadier spending helps.
- Increase Your Deposit
A larger deposit reduces risk to the lender and can open up higher income multiples.
Choose the Right Lender
Lenders' policies vary more than most people realise. Some lenders favour:
- Single applicants
- High earners
- Certain professions
- Families with childcare costs
- Self-employed applicants
- Zero-hour or variable income
Others have more flexible criteria for:
- Expats
- People with poor credit
- Applicants who've previously been in arrears
The match matters. A mortgage adviser can help you navigate these policies and guide you toward the product that fits your situation best.
6. When to get advice
You don't need to wait until you've found a home. Always speak to an adviser early, especially if:
- You have childcare costs
- You're self-employed
- You have loans or credit cards
- Your income varies
- You want to know how different lenders will treat you
An adviser can show you your real borrowing range, not the broad estimate you'll get online.
7. Final thoughts
Affordability rules can feel blunt, especially when two lenders give you wildly different numbers. Try not to let that put you off. These checks aren't a judgment on how you manage your life; they're guardrails designed to stop you from taking on a mortgage that becomes unmanageable.
If your first result isn't what you hoped for, don't assume that's the end of the road. Different lenders take very different views, and a small change in how your income or outgoings are treated can shift things meaningfully.
A good mortgage adviser can look at your full picture, compare lenders quickly, and help you understand what's genuinely possible. Speaking to one early often saves time, stress, and a few wrong turns.