How much can I borrow?

How Much Can I Borrow?

‍Are you considering buying a home? One of the most common questions that comes to mind is, “How much can I borrow?” Understanding your borrowing potential is a crucial step in the mortgage process. In this comprehensive guide, we will walk you through the factors that determine your borrowing capacity as a contractor, providing you with valuable insights and expert advice through tools like a mortgage calculator and mortgage eligibility calculator UK.

Mortgage Guaranteed Based on Your Day Rate

As a contractor, your income structure may differ from that of a salaried employee. Traditional lenders often assess borrowing capacity based on annual accounts, which may not accurately reflect your financial situation. However, there’s good news! MortgageTek s contractor mortgage calculator, a type of contractor calculator UK, is a fantastic tool designed specifically for contractors looking to buy a home. This contracting calculator considers your day rate, making it a more accurate representation of your income potential than a standard UK contractor calculator.


Mortgage Calculator

 Disclaimer: Please note that the results generated by this calculator are for general estimation purposes only and may not be entirely accurate. For precise information call us 020 3827 8558


The ‘How much can I borrow’ calculator is rapid and simple to use, functioning as a day rate calculator and mortgage calculator based on salary. However, its purpose is to provide a basic understanding of your potential borrowing capacity. Keep in mind that your final mortgage agreement will depend on various criteria, including your total deposit, daily rate, financial commitments, credit history, number of dependents, mortgage terms, and the number of applicants.

To receive a comprehensive quote tailored to your specific circumstances, give us a call today. Our team of expert mortgage brokers is ready to guide you through the process and provide you with personalised advice. Contact us at 020 3827 8558 for assistance in navigating your mortgage options.


How much can I borrow?

To determine how much you can borrow as a contractor, you can use a contractor mortgage calculator. This tool is designed specifically for contractors and freelancers to assess their borrowing potential based on their income and employment status.

Here are the steps to use a contractor mortgage calculator:

  1. Find a Contractor Mortgage Calculator: Search for a reputable contractor mortgage calculator online. Many mortgage brokers and financial websites offer this tool.
  2. Input Your Details: Enter your annual contract earnings, type of contract (e.g., limited company or umbrella), and any regular monthly expenses.
  3. Review the Results: The calculator will generate an estimate of how much you could potentially borrow based on your input.
  4. Seek Professional Advice: While a mortgage calculator can provide an estimate, it’s advisable to seek advice from a mortgage broker or financial advisor who specialises in contractor mortgages to get a more accurate picture of your borrowing capacity.

Remember that the amount you can borrow will depend on various factors, including your contract rate, length of contracting history, and the mortgage lender’s criteria for contractors.

By using a contractor mortgage calculator and seeking professional advice, you can gain insight into your borrowing potential as a contractor.

Factors That Determine Your Borrowing Capacity

Total Deposit

The amount of money you can put towards a mortgage deposit plays a significant role in determining your borrowing capacity. Generally, the larger the deposit, the more favourable the mortgage terms you can secure. Lenders often require a minimum deposit percentage, typically ranging from 5% to 20% of the property’s value. However, a higher deposit can lead to better interest rates and lower monthly repayments, making the property value a key factor in your mortgage planning.

When considering a mortgage, it’s important to take into account not only the principal and interest but also the taxes and insurance associated with the property. This comprehensive approach gives you a clearer picture of the total cost of homeownership. Here’s how you can calculate your mortgage with taxes and insurance:

Benefits of Factoring in Taxes and Insurance

  • Provides a holistic view of homeownership costs
  • Helps in budgeting for the total monthly housing expenses
  • Enables better comparison of different loan options based on the total monthly payment, not just the principal and interest.

Using a mortgage calculator that allows you to input these variables will simplify this process and give you a clearer understanding of the financial commitment associated with your mortgage.

Income and Financial Commitments

Your net income, including your daily rate and any additional sources, is a critical factor in assessing your borrowing capacity. Lenders will evaluate your monthly income stability and affordability to ensure that you can comfortably meet your mortgage repayments. Additionally, lenders will consider your financial commitments, such as existing loans, credit card debts, and other regular expenses, to determine how much you can borrow.

Credit History and Rating

A strong credit history and rating can significantly impact your borrowing capacity. Lenders use this information to assess your creditworthiness and determine the level of risk involved in lending to you. A positive credit history, characterised by timely repayments and responsible financial behaviour, increases your chances of securing a higher mortgage amount and more favourable interest rates.


If you have dependents, such as children or elderly parents, lenders will take their financial needs into account when assessing your borrowing capacity. The number of dependents you have can influence the disposable income available for mortgage repayments. It’s important to provide accurate information about your dependents to ensure an accurate assessment of your borrowing potential.

Mortgage Terms

The terms of your mortgage, including the mortgage term and the type of interest rate (fixed rate mortgage or variable rate mortgage), can impact your borrowing capacity. You can use MortgageTek mortgage calculators to check you borrowing potential . Longer mortgage terms generally result in lower monthly repayments but may also mean paying more in interest over the life of the loan. Conversely, shorter terms may have higher monthly repayments but can help you pay off your mortgage faster.

Number of Applicants

If you are applying for a joint mortgage with another person, such as a partner or spouse, the lender will consider both applicants’ financial circumstances. This can affect your borrowing capacity, as lenders take into account the combined incomes, financial commitments, and credit histories of all applicants in a joint mortgage.

Get a Comprehensive Quote Tailored to Your Circumstances

Now that you have a basic understanding of the factors that determine your borrowing capacity, it’s time to get personalised mortgage advice and a comprehensive quote tailored to your specific circumstances. At MortgageTek, we specialise in assisting contractors like you in finding the right contractor mortgage solution. Our team of expert mortgage brokers is dedicated to providing personalised, transparent, and comprehensive services.

Give us a call today at 020 3827 8558 to speak with one of our mortgage brokers. We will guide you through the process, analyse your financial situation, and provide you with a comprehensive mortgage quote that aligns with your needs and goals. Take the first step towards homeownership and secure your dream home with confidence.

Additional Services and Support

At MortgageTek, we understand that buying a home involves more than just securing a mortgage. That’s why we offer additional services and support to ensure a smooth and stress-free experience for our clients. Here are some of the additional services we provide:

Contractor Protection

As a contractor, protecting your income and financial stability is crucial. We offer contractor services, including income protection, that provide you with peace of mind in case of unexpected events that may impact your ability to work and earn an income.

Family Life Insurance

Ensuring the financial security of your family is paramount. Our family life insurance policies are designed to provide financial protection to your loved ones, offering them the ability to uphold their standard of living and manage essential expenses in the event of your untimely demise.

Mortgage Protection

Taking on a mortgage is a substantial financial undertaking. Our mortgage protection services are tailored to give you reassurance, covering your mortgage repayments in the face of unexpected events such as illness, disability, or job loss that could hinder your payment capacity.

Income Protection Insurance

For contractors whose earnings may be variable, having a financial safety net is crucial. Income protection insurance ensures a consistent income stream if you find yourself unable to work due to health issues or injury, thus preserving your financial stability and enabling you to fulfil your financial commitments.

Critical Illness Insurance

Being diagnosed with a critical illness can have a profound effect on both your personal life and financial health. Our critical illness insurance policies offer a one-time payment upon such a diagnosis, aiding in the management of healthcare costs, necessary lifestyle changes, and other monetary responsibilities.

Relevant Life Insurance

Contractors who are also directors of their own limited company can benefit from relevant life insurance, a tax-efficient solution for life coverage. This type of policy delivers a tax-free lump sum to your beneficiaries in the event of your passing, securing the financial well-being of your family.

Family Income Benefit

Family income benefit, a variant of life insurance, ensures a regular, tax-free income for your family upon your passing. This financial support is instrumental in helping them preserve their lifestyle and cover indispensable expenses, including mortgage payments, educational fees, and day-to-day costs.

Grasping your borrowing capacity is a critical step towards homeownership. Assessing mortgage criteria such as your total deposit, income, existing financial obligations, credit standing, dependents, mortgage terms, and the number of applicants provides a clear picture of what you can afford as a contractor.

At MortgageTek, we are committed to helping contractors like you navigate the mortgage process with confidence. Our team of expert mortgage brokers is ready to provide personalised mortgage advice, tailored quotes, and additional services to ensure a smooth and successful home-buying experience.

Contact us today at 020 3827 8558 to speak with one of our mortgage brokers. Let us guide you towards securing your dream home and achieving your homeownership goals. Trust MortgageTek to be your knowledgeable and trustworthy guide in the mortgage industry.