How much can I get in a mortgage?

How much can I get in a mortgage?

How much you can borrow is a complicated calculation with several factors. Here we give you more information about how much you can expect to get in a mortgage.

How much can I get in a mortgage? – that’s a question many people wonder

How much you can get in a mortgage or how much you can borrow in relation to your income depends on a number of things, but as a general rule with all banks the framework in the Lending Regulations applies.

There are 2 particularly important elements here:

  • The customer must not have more debt in total than a maximum of 5 times the annual gross income (if there are 2 or more people who are going to borrow together, the total income before tax applies)
  • The loan granted for the purchase of a home must not be more than 85% of the home’s purchase price or value.

How banks calculate a customer’s liquidity is quite different. It is important that you have a few thousand to spare each month, even with an interest rate that is 5% higher than today’s actual interest rate. This is called “stress interest”.

Other things that come into play are:

  • Number of cars
  • Number of children under the age of 18
  • What type of other loans you have
  • How long you have been employed in your current job
  • How long you have lived in your current home
  • Education

How much can I borrow?

Many people wonder how much they can get in loans, and most often mortgages. The simple answer that often comes up is that you can borrow up to 5 times your gross income. This is not necessarily true. Some customers with a high fixed salary can probably expect a maximum loan based on 5 times their gross income, but for the vast majority it is income minus costs that gives the answer to how much loan you are granted.

The banks do not base themselves on the current interest rate level, but must take into account a future interest rate level. They must be sure that the customer can tolerate a 3% higher interest rate than today’s floating interest rate. When the interest rate is on the way up, this surcharge the customer must bear rises in parallel. It will therefore be more difficult to get a loan.

Another thing many people forget is that how much you can borrow, i.e. this 5 times, includes all loans. Student loans, car loans, boat loans and consumer loans/credit cards must be included in the calculation. For example, if he has NOK 650,000 in total debt excluding mortgages, this must be included in the calculation. For example, if you have a credit card that has not been used, but has a credit limit of NOK 50,000, then the credit limit is also debt that must be included in the calculation.

How much you can borrow is a complicated calculation with several factors .

One is that you must satisfy requirements for total borrowing of a maximum of 5 times gross income.
Another requirement is that the banks cannot grant loans for the purchase of housing in excess of 85% of the value of the housing provided as security.
A third requirement is that you have liquidity that means you are able to service your debt even with an interest surcharge of 3%.

The banks have often incorporated these requirements into a calculation model that varies from bank to bank. This takes account of salary income, possibly rental income or other income. Furthermore, it takes into account existing debts, new loans you apply for, the number of properties you own, how many people the household consists of, the number of cars you have and a good deal of other things. It is no secret that couples with and without children make a big difference in the banks’ calculation models.

In short: there is no easy conclusion on what you can borrow, but we can make it easy for you as a customer;

You can contact EIendomsfinans today and get an answer to this – completely free of charge. We offer your own adviser who knows which bank suits you best, and who knows the different banks’ calculation models. There are big variations on how much you can borrow. If you want to know exactly how much your income means you can borrow, contact us today!