Bonus, commission and overtime
Lenders vary a lot here. Some only count half of your bonus. Others will use all of it, averaged over the last two years, and a few will use the latest year if it's paid regularly. If a large part of your pay is variable, choosing the right lender can change what you can borrow by a big amount.
Shares and other income
If part of your pay comes as shares, for example restricted stock units that vest every year, a small number of lenders will take them into account. Rental income, investment income and a second job can also count, depending on the lender and how long you've had them.
Higher income multiples
Most lenders cap borrowing at around four and a half times income. Some will go higher for people earning above a certain amount, or for particular professions such as doctors, dentists, lawyers and accountants. It still has to be affordable once your outgoings are taken into account, and I'll be straight with you about that.
Loans of £1 million and above
Fewer lenders work at this level and they look more closely at each case. Most limit how much they'll lend as a share of the property value once the loan gets above a certain size, so you'll usually need a bigger deposit. Valuations take more time too.
Private banks are an option for some clients. They look at your overall wealth as well as your income and can be more flexible, though some expect you to hold savings or investments with them. They aren't always cheaper than mainstream lenders, so I'll compare both.
Interest only
Some lenders offer interest only, or part interest only and part repayment, to higher earners. You'll need a believable plan to repay the loan at the end, such as investments, the sale of another property, or regular bonuses paid off the balance. Lenders usually set a minimum income or a minimum amount of equity before they'll consider it.
The high net worth option
If you earn at least £300,000 a year, or have net assets of at least £3 million, you can choose to be treated as a high net worth customer. That allows some lenders to be more flexible on affordability, but it means giving up some of the protections that normally apply. I'll explain what that means before you decide.
