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How much can I borrow ?

The amount that you are allowed to borrow will be dependent on a financial examination of the borrower by the lender. Lenders normally calculate how much you have left at the end of each month after you have paid out your essential bills.

Generally, they will look at;
• Your total income
• Outstanding loans, credit card balances and other commitments
• Household bills and living expenses such as commuting costs

If your work involves payment by bonuses, commission or overtime, lenders tend to view this as non-guaranteed income and may only consider half of it when they add it to your other income.

Under the Financial Services Authority (FSA) rules, the lender must not give anyone a mortgage loan they won't be able to afford. Lenders should lend responsibly. Traditionally, the amount lenders would give would be based solely on the income of the borrower, now it's more about looking at the whole picture through an affordability assessment. It's crucial that you look at your finances carefully before taking on a mortgage loan. If you are unsure about how much you should be borrowing, please contact a financial advisor.

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