Residential Affordability Report
Applicant 1
If you have two jobs switch between the employment status and complete the fields. Where both of your jobs are of an employed status key the combined incomes into the employment section.
Please enter the figures before tax.
Employed - PAYE
Do you receive bonuses, commission or overtime?
Yes No
Annual - Bonuses
Quarterly - Bonuses / Commission
Monthly - Commission / Overtime
Weekly - Commission / Overtime
Self-employed / Sole Trader
Please use the figures before tax on your SA302's / Tax Return. The most recent year cannot be more than 18 months old.
Director - Limited Company
Please use the figures on your latest company accounts to complete the fields below, note that the most recent years of accounts cannot be more than 18 months old.
Most recent year
Previous year
Income used
Applicant 2
If you have two jobs switch between the employment status and complete the fields. Where both of your jobs are of an employed status key the combined incomes into the employment section.
Employed - PAYE
Do you receive bonuses, commission or overtime?
Yes No
Annual - Bonuses/ Commission/ Overtime paid before tax
Quarterly - Bonuses/ Commission/ Overtime Paid before tax
Monthly - / Commission/ Overtime paid before tax
Weekly - Bonuses/ Commission/ Overtime paid before tax
Self-employed / Sole Trader
Director - Limited Company
Most recent year
Previous year
Income used
Income for affordability
Home Purchase Options / Mortgage schemes
| Standard residential - Small deposit. | Standard residential – Large deposit. | Professional mortgage | High Income Mortgage £70k+ | Helping hands | Shared ownership | |
| Income multiple | 4.49 | 5 | 5.5 | 5.5 | 5.5 | 4.49 |
| Deposit | 5% | 15% | 10% | 15% | 5% | 5% |
| Mortgage | See the shared ownership section below | |||||
| Purchase price | See the shared ownership section below |
Notes
| - Not all banks will use 100% of additional income. Various banks will use between 50% - 100% of additional income. - Where the most recent years bonus is lower than the previous year, the bank will use this as your asumed income. - Where the total of the additional income surpasses the basic salary and allowances the bank may cap this equal to the total of the two. The bank will sense check the additional income where this is non-contractual. - Where an applicant is both employed and self-employed the bank will sense check this and ask for a breakdown of hours, in addition to completing detailed underwriting. |
Shared ownership
| In order to obtain an accurate figure of what you can afford with shared ownership you must first search for a property, this will give you guidance on how much the rent and service charge will be, which are figured required for the affordability calculator to be accurate Calculator - https://www.sharetobuy.com/mortgage-affordability-calculator/ Property Search - https://www.sharetobuy.com/properties/ |
Other Considerations
| Affordability | On some occassions the amount you can purchase a property for will be capped by the amount of deposit you have available, i.e. if your income is £60,000 you may be able to borrow up to £300,000 but if the deposit required has to represent 15% of the purchase price and your deposit is for example £40,000; if £40,000 were to equal 15% then this would cap your maximum purchase price to £266,666 (£40,000 divided by 15%). |
| Credit commitments i.e. loans, credit cards etc | The above figures assume there is no underlying debt in the background, where there is underlying debt i.e. credit card balances outstanding, loans outstanding, etc the amount you will be able to borrow will decrease. This is lender specific and we will only calculate this where the applicant(s) wish to proceed with an actual morgage and wish to undertake credit checks in order to obtain a mortgage in principle. |
| Professional mortgages | Only certain occupations such as Doctors, Barristers, Pilots, Architects etc qualify for a professional mortgage please get in touch to see whether you qualify. |
| Shared ownership | With shared ownership usually a minimum of a 25% share of the property needs to be purchased. The report does not take into consideration how much rent you would have to pay on the outstanding share and this affects affordability differently with every bank, therefore take into consideration that the overall property value is likely to be lower than the figure provided. |
| Shared ownership income | Where income exceeds £80,000 outside of London & £90,000 inside of London, the shared ownership scheme will not be available to you. For further information please see the Shared Ownership gov webpage: https://www.gov.uk/affordable-home-ownership-schemes/help-to-buy-equity-loan |
| Interest rates | The interest rates are for example purposes only, please contact a broker to get live rates and an accurate monthly payment |
| Stamp duty | We suggest using the stamp duty calculator found at the site provided to obtain an idea of thetax liable for your purchase, for a more accurate figure please speak with your solicitor. https://www.stampdutycalculator.org.uk/ |
| Second job | If you have a second job please schedule a call with a broker to discuss this further. |
Definitions
| Average income annualised: | The bank will look at your additional income over a set period and take an average; the annualised income is what your income would be over the course of a year if you were to continue earning as much as you currently are within a set period. |
| Loan to annual income multiple: | Banks will use your annual income, multiplied by a figure to determine how much you can borrow. This varies depending on the LTV and the mortgage type |
| Deposit | The deposit keyed represents the various percentages for the mortgage products i.e. your deposit will represent 10% for a helping hands product but 5% for a standard residential small deposit product |
| Mortgage | This is how much the bank would be willing to lend you subject to your income disclosed |
| Purchase price | This is the amount you can purchase a property for based on your income plus the smallest amount of deposit required |