how much of your income is your mortgage

Lady1981

My share of our mortgage is over 50% of my income. :eek: This is due to me losing two much better paid jobs in the last year. Thankfully my other half has very kindly offered to pay more towards the mortgage for now and I have begrudgingly accepted.

Lady xx

Trying_to_be_good

My share is 31% of net income, but I offset save/overpay by the same amount to try to reduce the debt - I have a well paid job at the moment, but I save/overpay the extra so I don't get used to spending it!

Joe_Bloggs

I spend 20% of net income before overpayments and 42% net with overpayments.

I think that a detailed budget that demonstrates the affordability for a mortgage is going to be a requirement for the lender and the borrower. MSE Martin has a budget planner here.

There has to be a margin to allow for a build up of savings for unexpected events. Many mortgages eventually drop on to a Standard Variable Rate. Who is to say what this SVR will be in three or five tears time. I have heard of some lenders stress testing the borrowers budget by seeing if they could afford things if rates were 10%.

J_B.

stingy_rach

Depressingly we pay 30% of our gross income and 65% of our net income each month on our mortgage. :eek:

This is fixed for another two years and surprisingly, we sought financial advice from the bank and an independant advisor last year who agreed this would be realistic! While we can still afford to eat it would be nice to have some more left over each month! Thankfully I am earning bonus every six months at the mo otherwise we would have no way of saving anything.

Hoping to start overpaying soon!:rotfl:

Wutang_2

about 79.3%

opinions4u

stingy_rach wrote: »

Depressingly we pay 30% of our gross income and 65% of our net income each month on our mortgage.

If you both earn £36k salaries then your combined gross pay would be £6k a month, making a mortgage payment at 30% of this £1,800 a month.

Net pay x 2 would typically be £4,460 which would mean the mortgage payment is 40%, not 65% of net pay.

There can, of course, be many other deductions made from salary that can distort this, such as pensions, company car tax, sharesave schemes and other benefits in kind.

The example you give rather supports the need for such questions to clarify the "net" or "gross" question and for me says that "gross" is the most appropriate way to compare like with like.

This is fixed for another two years and surprisingly, we sought financial advice from the bank and an independant advisor last year who agreed this would be realistic!

In what way? Were you borrowing additional funds at the time? Or simply remortgaging from one lender to another.

stingy_rach

I see what you mean about net/gross. Surely it's sensible to discuss net salary when discussing affordability unless someone has a way of cheating the taxman that I don't know about!

In what way? Were you borrowing additional funds at the time? Or simply remortgaging from one lender to another.[/QUOTE]

We moved house to a completely different (and more expensive) area of the country and so needed a new mortgage to fund our jump up the housing market. Both Halifax and our mortgage advisor agreed that 65% was a fair percentage of our income to pay towards our mortgage although being on here has certainly put a different spin on things!

kriss_boy

Depends entirely on your income as to whether or not a high mortgage can be easily affordable.

Our combined after tax income is about £2500 of which about 19% is our mortgage. We intend to increase our overpayments next year to equate to around 35%.

getmore4less

eyegeegeewhy wrote: »

Hi

I am currently saving for a deposit but I worry about how much of my current income i can assign to paying for a mortgage.#

So just wandering, what % of your total monthly income do you spend on your mortgage?

% of income is meaningless measure of affordability

depends on you income and spends.

Not just now but in the future as well.

cake21

I pay 32% of my net salary, 54% including overpayments. But if I had my time again I wouldn't commit to more than 20% of my net salary.