How many lenders offer 6 times salary mortgages?
WHICH LENDERS OFFER SIX TIMES SALARY MORTGAGES?
There is a growing selection of lenders offering six or even 6.5 times salary mortgages. Over the past few weeks, even more lenders have begun offering more generous income multiples.
Potentially borrowing up to 6 times single or joint salary is a larger income stretch, but it is an option that is surprisingly becoming more common in the mortgage industry. Higher income multiples of 6 times salary are typically reserved for first-time buyers and borrowers who meet specific criteria, such as meeting higher income thresholds.
Bank of Ireland for Intermediares is the latest bank to start offering up to 6 times salary mortgages. They are also available through Nationwide for Intermediaries, Tipton Building Society and Kensington for Intermediaries. Although some of the UK's largest mortgage lenders, including HSBC and Santander for Intermediaries, have eased their mortgage affordability in many cases, issuing mortgages worth up to £39,000 more, they are still not generous enough to help many borrowers onto the property ladder.
6 times salary mortgages comment
Aaron Strutt, product director at Trinity Financial, says, "Mortgage lenders use affordability calculators to determine how much applicants can borrow, but they are increasingly having separate policies and rates for their income stretch mortgages of up to six times salary.
"A recent report showed that more first-time buyers are purchasing semi-detached homes rather than flats and they are using income stretch schemes to get the properties they want. Clearly, this is often easier with joint applications when there are two incomes."
Many borrowers do not need to borrow the full six times their salary; they need a more generous affordability calculation. That said, the Nationwide Helping Hand product offering six times salary has been incredibly popular, and lenders are coming into this market because they know there is a need from all types of borrowers."
Banks and building societies offering 6 times salary mortgages include:
| Lender | Max Income Multiple | Minimum Income Requirement | Loan-to-Value (LTV) Limit | Eligibility Notes |
| Nationwide for Intermediaries | Up to 6x | £30,000 for single applicants £50,000 for joint. | Up to 95% (5% deposit) | Available to first-time buyers via the Helping Hand range |
| Bank of Ireland Bespoke | Up to 6x | £50,000 for single applicants and £75,000 for joint. | At least 10% deposit | Part of the Bespoke rate is exclusively available to selected brokers, including Trinity. |
| Hodge for Intermediaries | Up to 6x | £75,000+ for purchases. | 80% (20% deposit) | Purchase and remortgage. |
| Tipton for Intermediaries | Up to 6.5x | Up to 80% (20% deposit) | Long-term track record of offering income stretches. | |
| Teachers for Intermediaries | Up to 6x | £200,000+ | Larger deposit required | Lend to the employed and self-employed. Part of the "complex" range and uses bonus income. Not just for teachers. |
| Darlington for Intermediaries | Up to 6x | Up to 90% (10% deposit) | ||
| Kensington for Intermediaries | Up to 6x | £100,000 | Vaires depending on the product | Can lend up to 6x on the Select range for applicants earning over £100k. Also, have longer-term fixes for those with lower incomes. |
| United Trust Bank | Up to 6x | 85% (15% deposit) | Maximum loan size £1 million. | |
| Newcastle for Intermediaries | Up to 6x | 90% (10% deposit) | For borrowing between £450,000 and £3.5 million. Employed applicants only. |
Source: Lender websites
Are six-times-salary mortgages more expensive?
Yes, you will probably need to pay a higher rate to access a six times salary mortgage. The rates are likely to be much higher than the cheapest mortgages available to those with a 35% or 40% deposit and borrowing around five times their salary.
With Nationwide's Helping Hand scheme, mortgage borrowers will need to take out a five- or ten-year fixed-rate mortgage. Hodge, Tipton, and UTB charge higher rates for six times salary mortgages if you need an income stretch.
With so many lenders offering six times salary, you need to ensure you are getting the most competitively priced rate, especially if you have to take a three, five or ten-year fix to get the money you need to buy the property you want.
Regulatory limits eased to improve mortgage affordability
The Bank of England has rolled out looser mortgage rules in a bid to help thousands more first-time buyers onto the housing ladder each year.
New guidelines announced by the Bank of England mean that individual banks and building societies can offer more high loan-to-income (LTI) mortgages, which are equal to, or worth more than, 4.5 times a borrower’s annual earnings. They will not be allowed to offer that many larger income stretch mortgages.
If you're considering a mortgage at 6 times your salary, it's advisable to consult with a mortgage broker, like Trinity Financial, who can assess your individual circumstances and guide you to suitable lenders with the most competitively priced rates. A 5.5 times salary or 5.75 salary may be sufficent.
Here is a table to show how much you may be able to borrow depending on your salary:
| Single or joint income | 5x salary borrowing | 5.5x salary borrowing | 6x salary borrowing |
| £50,000 | £250,000 | ££275,000 | £300,000 |
| £75,000 | £375,000 | £412,500 | £450,000 |
| £100,000 | £500,000 | £550,000 | £600,000 |
| £125,000 | £625,000 | £687,500 | £750,000 |
| £150,000 | £750,000 | £825,000 | £900,000 |
Key Considerations for 6x salary mortgages
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Is it sensible to borrow 6 times one's salary for a mortgage? Many people would think that borrowing up to 6 times their salary was not very sensible. Still, it is increasingly becoming a necessity for those struggling to get sufficiently large mortgages to get on the property ladder.
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Deposit size: Varies depending on the lender and your income. Need at least 10% deposit typically.
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First-Time Buyers: Make sure you get the most competitively priced rate if you are stretching to six times your salary.
- Choice of fixed rates: With numerous mortgages available, you don't necessarily have to opt for a very long-term fixed rate, even if a specialist lender offers one.
Call Trinity Financial on 020 7016 0790 to secure an income stretch mortgage, book a consultation, or complete our mortgage questionnaire.
The information contained within was correct at the time of publication but is subject to change.
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