Sarah and Tom had a very successful start to seeing what they could borrow on a fixed rate mortgage. In our latest article we take a look at this common question. 

So when you’re thinking about buying a home or remortgaging, one of the first questions you’ll ask is, “How much can I borrow?” And if you’re considering a fixed rate mortgage, the answer involves a mix of your personal finances, lender criteria and the type of fixed deal you choose.

At HFA Mortgage & Protection, we guide clients through this process every day, helping them understand exactly what’s possible, before they even start looking at properties. Fixed rate mortgages remain a popular choice for both first-time buyers and existing homeowners because they offer certainty: your monthly payments won’t change for the length of the fixed term. But how much you can borrow depends on more than just the rate.

How Lenders Calculate What You Can Borrow

Mortgage lenders typically work on an income multiple. For example, lending four to five times your annual salary. However this isn’t the whole story. They also carry out affordability checks, which consider:

  • Your income – Salary, bonuses, overtime, self-employed earnings, and other regular income sources.
  • Your outgoings – Loans, credit cards, childcare costs, car finance, and living expenses.
  • Deposit size – The bigger your deposit, the better your borrowing potential.
  • Credit history – A solid track record of repayments can open the door to higher borrowing limits.

For fixed rate mortgages, lenders also factor in the length of the fixed term and current market interest rates to ensure your payments remain affordable now and in the future.

Case Study: Sarah & Tom’s Fixed Rate Success

Sarah and Tom, a young couple from Ormskirk, came to HFA Mortgage & Protection wanting to buy their first home. They had a combined income of £62,000 a year and a 10% deposit saved. They were keen on the idea of a fixed rate mortgage because they liked the security of knowing their payments would stay the same, but they weren’t sure how much they could borrow.

They’d already spoken to their bank, who told them they could only borrow £248,000 based on their affordability calculation. This was less than they’d hoped for and limited their property search.

We carried out a full financial review, taking into account income from Tom’s regular overtime (which the bank had overlooked) and a small annual bonus Sarah received. We also reviewed their outgoings and advised them on a few small changes to reduce monthly spending, which made a difference in the affordability calculation.

By matching them with a lender who took a more flexible view on overtime and bonuses, we secured an Agreement in Principle for £275,000 on a 5-year fixed rate. This not only expanded their property search to where they currently rented in Ormskirk, but also gave them the payment stability they wanted.

Sarah says: “We were amazed by the difference. HFA explained everything clearly and it felt like they knew exactly which lenders would work best for us. The fixed rate means we can budget easily without worrying about rising interest rates.”

Within six weeks, Sarah and Tom had an offer accepted on their dream home, which was something they thought might take much longer.

Why Fixed Rates Can Affect Borrowing Power

While fixed rate mortgages are attractive for budgeting, it’s important to understand that the interest rate you lock into will directly influence your maximum borrowing amount. A higher fixed rate means higher monthly repayments, which can reduce how much the lender will agree to lend.

The good news is, the fixed rate market is competitive, and rates can vary between lenders, sometimes more than 0.5%. That’s why working with a broker is so important; we can compare deals across the market and match you with the right combination of rate, term length, and lender criteria to maximise your borrowing potential.

The Benefits of Getting Advice Early

Speaking to a mortgage adviser before you start viewing properties means:

  • You know your realistic budget from the outset.
  • You can get an Agreement in Principle quickly, making you a stronger buyer.
  • You can explore different fixed rate terms (2-year, 3-year, 5-year, even 10-year) to see what fits your lifestyle.
  • You avoid disappointment by focusing only on properties within your borrowing range.

Ready to See How Much You Could Borrow?

Whether you’re buying your first home, moving, or remortgaging, knowing your borrowing potential is the first step. At HFA Mortgage & Protection, we’ll review your full financial picture, find the right lender for your situation, and secure a fixed rate mortgage that gives you peace of mind and the keys to your new home.

Call us today or visit https://hfassociates.uk to get started.

Important Notice:

There may be a fee for mortgage advice. The precise amount of the fee will depend upon your circumstances but will range from £195 to £1500.

Your home may be repossessed if you do not keep up repayments on your mortgage.