A good shared ownership provider will want to make sure that shared ownership is a sustainable housing option for any buyer.
To do this, providers use a calculation that looks at what a buyers' housing costs* would be as a % of their disposable income*.
Our web-site enables you to enter basic information about your disposable income and the deposit available to you. This means we can mirror the financial test of the provider to see if you would meet this test for the lowest share that is available.
As a rule, if your housing costs would be between 30% and 45% of your disposable income you would normally meet this test. Some providers may extend this range down to 25% and/or up to 50%
Several factors will determine your actual housing costs, and these include:
This is charged on the share you do not own and is set when a shared ownership property is first sold. The monthly rent is usually set by multiplying the value of the share you don't buy by a percentage and then dividing it by 12. The rent will be reviewed each year in accordance with the terms of the shared ownership lease. Your personalised results will show the rent that the provider has told us will apply to each property advertised on our site.Service Charge / Other Charges:
These charges can cover a range of fees covering leasehold management, maintenance costs for communal areas, estate charges and buildings insurance. These charges are usually reviewed each year in accordance with the terms of your share ownership lease. Your personalised results will show the charges that the provider has told us will apply to each property advertised on our site.Mortgage:
To carry out the initial financial eligibility test certain assumptions will be made to calculate the cost of any required mortgage. This is for the purposes of completing the financial assessment required to determine if you meet the shared ownership provider's financial eligibility test for a shared ownership lease. It is important to remember that these may not be the terms that you can actually get, as these will be based on your individual circumstances and you will need to obtain separate mortgage advice. The assumptions will cover the interest rate and the term of the mortgage.
Your personalised results will show the assumptions used in the calculation.
This is your income less any tax, national insurance and other financial commitments such as credit card payments, loans, car finance and child maintenance.