A new mortgage lender is offering homebuyers and homeowners the chance to borrow up to seven times their annual salary, a significant increase from the usual four and a half times.
April Mortgages, which launched its first products just a year ago, is making this higher borrowing available to first-time buyers, home movers, and those looking to remortgage. The seven times income multiple mortgages are open to both single and joint applicants, provided they earn at least £50,000 a year.
To benefit from the higher income multiples, customers must commit to a 10 or 15-year fixed mortgage. However, unlike many shorter fixed-rate deals, there are no early repayment charges if the borrower moves home or repays the mortgage in full. The only exception is if they switch to another lender during the fixed-rate period, which will incur early repayment charges.
It’s important to note that borrowers switching to a different lender will need to meet different affordability requirements. However, overpayments can be made at any time without penalty, and April Mortgages automatically reduces rates as borrowers pay down their loan and move into lower loan-to-value bands.
Customers can borrow up to 85% of the property’s value, with loan terms extending up to 40 years. Loan amounts start from £50,000, and in a scenario where a household earns £60,000 annually, they could potentially access a mortgage of nearly £420,000 with April Mortgages. This is a significant increase compared to the £270,000 that a typical high-street lender would offer based on the standard 4.5 times income cap.
Rachael Hunnisett, Director of Mortgage Distribution at April Mortgages, explains that this move aims to support people struggling with affordability due to house prices rising faster than wages. She highlights that the extra borrowing power could make the difference between settling for a smaller property and securing the home buyers really want.
Hunnisett says, “The housing market has shifted dramatically. With house prices rising far faster than wages, owning a home has become harder to achieve, even for those with steady incomes. But having a place to call your own still brings security, stability, and the freedom to build a life, and that shouldn’t feel out of reach.”
She continues, “We’re committed to making mortgages simpler, more flexible, and better suited to the way people live today. That’s why we’ve added a real borrowing bounce to our modern mortgage products, giving eligible borrowers the chance to access up to seven times their income.”
By offering this higher borrowing potential, combined with thorough affordability checks and long-term fixed rates, April Mortgages aims to help people not only get on the property ladder but stay there with confidence.
What are the rates?
Mortgage rates offered by April are generally higher than what borrowers might find from other lenders on the market. This is particularly noticeable when compared to some of the more competitive deals currently available.
For instance, a five-year fixed rate mortgage for someone with a 40 per cent deposit is available from Nationwide at just 3.94 per cent. Meanwhile, Santander offers a similar deal at 4.3 per cent for those with a 15 per cent deposit.
While April focuses on a long-term borrowing approach, even its 10-year fixed rates are significantly higher than other lenders’. For example, Santander offers a 10-year fix at 4.44 per cent for borrowers with a 40 per cent deposit, and Nationwide has a 4.84 per cent deal for those with a 15 per cent deposit.
To put this into perspective, a £200,000 mortgage over a 30-year term with Nationwide’s 4.84 per cent deal would result in monthly repayments of around £1,054.
In comparison, April offers a 10-year fixed rate of 5.35 per cent for those with a 40 per cent deposit. For buyers with only a 15 per cent deposit, the rate increases to 5.55 per cent. This means that on a £200,000 mortgage over the same term, repayments would be roughly £1,141 a month.
In addition to the higher interest rates, April also applies extra fees. There’s a non-refundable application fee of £195, as well as a £995 product fee. However, borrowers do have the option to add the product fee to their mortgage balance if needed.
While April’s approach offers flexibility and long-term certainty, it does come at a higher upfront and monthly cost compared to more traditional lenders.
Can people afford to stretch to 7x income?
The main question many are asking is: how far are people willing to stretch their budgets just to get on the property ladder?
Take, for example, a couple each earning £30,000 a year. After income tax and national insurance, each would take home around £2,093 a month, giving them a combined monthly income of £4,186. This doesn’t even take into account any pension contributions, childcare expenses, student loan repayments, or other financial commitments.
According to April Mortgages, a household with a gross income of £60,000 could potentially borrow up to £420,000. However, securing that level of borrowing would require them to fix their mortgage at a rate of 5.55 per cent over a 36-year term – the minimum term to meet affordability criteria. That would mean monthly repayments of £2,248.
Once the mortgage is paid, the couple would be left with £1,938 a month to cover all other expenses such as food, utilities, transport, leisure activities, and home maintenance. For many, this would be a very tight financial squeeze.
April does advertise the option to extend the term to 40 years, which would reduce the monthly repayments slightly. Under the same borrowing scenario, this would bring the monthly cost down to £2,180 – giving the couple £2,006 a month for everything else.
While this makes a slight difference, the reality is the mortgage payments would still take up a huge chunk of their income. For most households, this could be too much of a stretch. However, for a select few – especially those currently paying similarly high rents – it might seem like a worthwhile trade-off.
In practice, most first-time buyers won’t need to borrow at such high income multiples. Many purchase in more affordable regions or receive help with their deposit from family, which reduces the amount they need to borrow.
According to UK Finance, the average first-time buyer currently borrows around 3.26 times their annual income – far below the seven times being offered by April.
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