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Could your profession land you a bigger mortgage to buy a home?

New mortgage offers higher income multiples, but only for doctors and dentists

Homebuyers could borrow up to six times their income from some lenders – but only if they work in certain professions. Are you currently in one of the jobs that could land you a bigger mortgage?

When you get a mortgage, you can usually only borrow 4.5 times your annual income – a figure known as the ‘income multiple’.

A new mortgage from Hinckley & Rugby Building Society, however, offers an 80% loan-to-value (LTV) mortgage at 5.5 times income – but it’s only available to dentists and doctors. The product is the latest in a line of bigger loans for buyers from some professions.

Here, we outline how these mortgages work, and explain what you should consider before applying.

New mortgage targeted at doctors

Under the Hinckley & Rugby loan, recently qualified doctors and dentists are able to borrow 5.5 times what they earn annually at an 80% LTV. But what does this mean in practice?

Say you’re a doctor earning £60,000 a year.

You’d ordinarily be able to borrow up to £270,000, depending on your other circumstances and, at 80% LTV, this means you could buy a house priced up to £337,500. With the Hinckley & Rugby loan, however, you could in theory get a mortgage of up to £330,000, meaning you could buy a house priced at £412,500.

The 5.5 times income multiple is only available to professionals with one to three-years experience, to recognise that medical professional incomes tend to accelerate quickly after the first few years. For doctors with more experience, the maximum income multiple decreases.

Applicants can include locum or other supplementary income, and will still be considered if they have been living abroad or are self-employed.

Do other professions benefit from bigger loans?

Doctors and dentists aren’t the only ones to benefit from mortgages with higher income multiples.

Darlington Building Society will allow you to borrow up to six times your annual income, but you must be an accountant, actuary, barrister, dentist, engineer, medical doctor, optometrist, pharmacist, solicitor or vet.

Its five-year fixed-rate loan is available at a 90% LTV with an initial rate of 3.69% (overall representative cost – or APRC – of 4.8%).

The full list of providers that offer mortgages for specific professions is below. For details of the deals available, and interest rates, you would need to contact the provider or speak to a mortgage broker.

Providers Eligible professions Mortgage types available Income multiples for eligible applicants
Dudley Building Society Accountant, actuary, architect, barrister, chartered surveyor, dentist, doctor, financial adviser, optometrist, pharmacist, solicitor, teacher, veterinary surgeon Discounted variable rate 3x annual income
Darlington Building Society Accountant, actuary, barrister, dentist, doctor, engineer, optometrist, pharmacist, solicitor, veterinary surgeon Fixed-rate 6x annual income
Scottish Widows Accountant, actuary, dentist, doctor, engineer, medical surgeon, optometrist, solicitor, teacher, trainee accountant, veterinary surgeon Fixed-rate, Variable-rate Varies by deal – up to 5x annual income
Clydesdale Bank Accountant, architect, barrister, chartered surveyor, dentist, doctor, engineer, financial adviser, nurse, optometrist, pharmacist, pilot, police officer, solicitor, teacher, veterinary surgeon Fixed-rate Ability to repay
Ipswich Building Society Self-employed – accountant, architect, dentist, doctor, optometrist, pharmacist, solicitor, surveyor, veterinary surgeon (for 3 years) Fixed-rate, discounted variable rate 5x annual income
Scottish Building Society Accountant, dentist, doctor, solicitor Fixed-rate, discounted variable rate Varies by deal – up to 4.5x annual income
Earl Shilton Building Society Dentist Discounted variable rate 4x annual income
Teachers Building Society Teacher Fixed-rate, discounted variable rate Varies by deal – 5x annual income

Find out more: compare hundreds of mortgages with Which? Money Compare

Why do professional mortgage deals exist?

It may seem unfair that some career paths qualify you for more favourable mortgage terms, while other jobs don’t – even though they may be just as well paid.

So why do accountants benefit from higher income multiples, but company CEOs don’t?

In some cases, the deals acknowledge the high future earning potential of some professions, despite relatively modest entry-level wages. For this reason, the Hinckley & Rugby loan is only available to doctors and dentists in their first few years of practice.

These professions also tend to have relatively strong employment prospects for the future, so represent a lower risk for lenders.

At the same time, certain professions rely on locum work or self-employment, which may make it hard to secure a traditional mortgage. Lenders targeting specific professions, however, will often take into account income that might otherwise be excluded or accept a shorter tenure at a job.

Often, these mortgages will be manually underwritten, meaning a person will make a decision, rather than a computer system. This gives you more room to include explain your specific financial situation and how you’re likely to afford the loan.

How do joint mortgages work?

Buying with a partner means you can pool your income – and get a bigger mortgage – but some lenders have strict rules around joint applications when you’re applying for a professional mortgage.

In some cases, both members of the couple must be in that profession to qualify for the highest income multiples.

At Darlington Building Society, for example, the joint income can be assessed at 6 times their annual income if both are members of an eligible profession. But if only one person is eligible, that person’s income will be assessed at six times, while the other person’s will be assessed at 4.5 times.

Some lenders also adopt lower income multiples for joint applications.

How much can you borrow?

You can use our affordability calculator below to find out how much you’re may be able to borrow, based on being granted a mortgage at 4 to 4.5 times your income.


Should you get a professionals mortgage?

Before you take out any mortgage, it’s important to shop around and weigh up your options.

Find the best rate

Keep in mind that a professional mortgage may not necessarily offer you the best rate.

Before rushing in, do your research into the other deals currently on offer and explore whether you’re likely to be accepted by those providers.

Assess your options if you’re self-employed

If you don’t have an employer, you may be worried that other providers will reject your application.

That isn’t necessarily the case. Many providers offer deals designed for contractors or the self-employed, so it’s worth looking at your options.

Consider saving more before applying

A mortgage geared at professionals may allow you to borrow more money, so that you can purchase a more expensive property. This could be especially appealing if you’re just starting out in your career and know you’ll be earning more soon.

But it may not always be wise to buy the most expensive property possible.

Think carefully about what you can afford to pay each month, and how that will impact on your household budget. Take into account also how an increased interest rate or change of lifestyle could affect your repayments.

In some cases, it may be wiser to buy a less expensive property at a lower LTV. For example, if you have a £40,000 deposit, you could either buy a £400,000 at a 90% LTV or a £200,000 home at a 80% LTV. Your interest at 80% LTV is likely to be much lower and you’ll own a larger share of the equity from the outset.

Your home may be repossessed if you do not keep up repayments on your mortgage.

Your home may be repossessed if you do not keep up repayments on your mortgage.

Which? Limited is an Introducer Appointed Representative of Which? Financial Services Limited, which is authorised and regulated by the Financial Conduct Authority (FRN 527029). Which? Mortgage Advisers and Which? Money Compare are trading names of Which? Financial Services Limited.

Categories: Money, Mortgages & property

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