Whats the general affordability rule for a loan nowadays?

dontlikemondays

I've read somewhere that it's 50% of your surplus income after expenses, and 50% of your yearly salary.

So if you have £500 surplus income every month, you could borrow upto £250 every month.
Plus if you earnt £20,000 per year, you can borrow upto £10,000

Can't remember now where I read it, but does anyone know if this is about right?

Gaz83

It's speculated that 50% of your annual salary is your maximum available credit. But lenders don't make their exact criteria public, and every lender will have their own rules.

dontlikemondays

So if your salary is £20,000 what's the maximum a business should lend you?
Plus, say it's £10,000, is it the actual loan (£10k) or the total amount repayable that counts towards affordability?

[Deleted User]

There is no maximum. It all comes down to the lender's risk appetite.

Gaz83

dontlikemondays wrote: »

So if your salary is £20,000 what's the maximum a business should lend you?
Plus, say it's £10,000, is it the actual loan (£10k) or the total amount repayable that counts towards affordability?

Every lender will have their own rules and criteria, these are not made public.

Their money = their decision.