This paper investigates how the transmission of monetary policy to the real economy depends on income and collateral borrowing constraints. Using an original dataset of UK mortgages, we assess the effects of monetary shocks on macroeconomic variables by exploiting time variation in the characteristics of new originations. We find that monetary policy is most potent when there is an abundance of mortgages recently issued at high income multiples. In contrast, when collateral constraints are loose and a large fraction of mortgages are issued at high loan-to-value ratios, monetary policy has a relatively stronger effect on asset prices. Taken together, we therefore provide new evidence for the importance of both the income and collateral channels of monetary policy.