The maximum price you can afford to spend on a home will be the combination of the amount you can borrow from a mortgage lender and the amount you can raise yourself.

But you need to decide whether you want to borrow as much as you can, or buy a cheaper home and have more flexibility in your finances. It may be tempting to borrow as much as possible when the initial cost is manageable, but remember that you could get into difficulties and lose your home if you can't keep up your repayments.

When you are deciding how much you can afford, don't forget to take account of the costs involved in buying a home, as some of these might eat into your savings. Also don't forget to take account of your normal living costs each month as these affect the mortgage repayments you can afford. And bear in mind that once you are a home-owner you will have to pay the cost of maintaining your home, as well as paying Council Tax and household bills.

The amount that lenders will be willing to lend you will vary. Lenders now calculate how much they are willing to lend by taking into account your other financial commitments, as well as your income.

If you are getting advice, advisers have a duty to take reasonable steps to ensure you can afford a mortgage that they recommend. Whether or not you get advice, lenders are required to lend responsibly and will try to make sure you do not overstretch your finances.