Shared Ownership Mortgage Calculations

ChloeManoey

Hi everyone,

(Hopefully) quick query regarding mortgages for purchasing a shared ownership property.

As an example - bank will generally lend 4.5x your annual salary.

Do the bank then make deductions from this amount, according to the rent and service charge?

Say the bank would lend £100k (round example)

If the rent and service charge for the shared ownership property comes to £300 per month for example ...
What would the maximum mortgage amount end up looking like?

Any info appreciated! Cannot seem to get a decent answer anywhere?!

MovingForwards

Have a play with this as it gives the option for shared ownership

https://www.nationwide.co.uk/products/mortgages/our-mortgages/mortgage-calculators/mortgage-affordability-calculator

haras_nosirrah

I am a shared ownership mortgage specialist and am on the panel of a couple of housing associations.

Yes the rent and service charge will be counted as an outgoing so you won't be able to borrow as much under shared ownership as you would on the open market as you will have the rent and service charge as an outgoing.

You will also need to pass the housing association affordability which is stricter than the banks affordability checks.

ChloeManoey

Thanks both, that's really helpful

Got to keep mortgage + rent + service charge under 45% of monthly pay, is that right?

haras_nosirrah

Mortgage, rent, service charge, pension, student loan, loans, credit cards are all counted in the 45%