How much should you borrow?

Deciding on how much you can afford to pay for a mortgage is very much your own responsibility. After many years working for a mortgage lender selling mortgages and supervising mortgage advisers I can tell you that a lender will have their own criteria for calculating how much they are prepared to lend and fundamentally this will be based upon their own assessment of your ability to pay the mortgage however the person in the best position to truly assess this is yourself. Rule of Thumb Methods There are a couple of rule of thumb methods that you can apply. It is important to note that in my opinion these will only give you a ball park figure to work ...  Read the complete review

The first thing to know is that not all debt or borrowed money is bad, borrowing money on a home or education can be a good debt. But more often than not we are tempted to borrow money for other things, things that we can not really afford to pay back or do not really need. After reading a little on the internet i have found that many experts agree that your repayments on any borrowed money should not exceed 40% of your monthly income. It would be amazing if we could all live debt free and never have to borrow any money, however now a days it is almost impossible to live debt-free. The majority of us could not afford our cars, homes, educations ...  Read the complete review

As someone who offers advice on mortgages and someone who has a mortgage of my own I can appreciate both sides to this story and will do my best to offer information both on my experience of buying and selling. My Experience As A Borrower I first took out a mortgage at the tender age of 19 with no financial experience at all. This was in the early 80's and house prices were relatively low. We managed to buy a 2 bed terraced house for £15,000 with an interest rate of 7%. We were paying in the region of around £90 per month. When we applied for the mortgage we were told that we could borrow 2.5 times our joint annual salary. We were both ...  Read the complete review

Just imagine it now, you have seen the house of your dreams and its say for example £80,000 and you earn £20.000 a year, the interest rates are low at the moment so you do your sums and work out that you could barely afford it if you give up a few luxuries. What would you do if the interest rates rise, it only takes it to rise by 1% or even 2% and you could be faced with the dilemma of losing your precious home, all because you borrowed more than you could afford. I think you get the idea. I think you should borrow just under what you could afford as when the interest rates rise, you have got enough money to cover the payments I earn £11,500 a ...  Read the complete review