More information about the Affordability Calculator
The information it provides isn’t definite as there will be other things that you need to take into account – therefore, the costs generated by this calculator are for illustrative purposes only and for your information.
They do not include everything you need to consider when choosing a mortgage and your actual costs may vary, according to your circumstances (and your credit rating), the property details, the lender, and the type of mortgage you take.
Whatever the results, there could be other options to getting on the property ladder that we can discuss with you. If you would like someone to call you to talk about buying a shared ownership property, you can simply complete our contact form.
We always recommend that you seek expert financial advice from an independent financial advisor. Organisations like the Citizens Advice Bureau may be able to help you with this but we make no recommendations or endorsements of any such people and you are responsible for ensuring that you seek advice from a reputable advisor.
As mentioned above, the results of the affordability calculator are indicative only and you should not place any reliance upon the results of it, or enter into any contracts or binding commitments in relation to those, without seeking independent advice. We are not making any recommendations as to (1) whether you should enter into a shared ownership arrangement at all, or (2) which particular lender or mortgage product might be right for you, and you should satisfy yourself before entering into any borrowing arrangements.
It is important for you to bear in mind that your home is at risk if you do not keep up repayments of a mortgage or other loans secured on it.
Assumptions and considerations
1. The figures in this calculator are based on capital and interest repayment over a 25 year term. Some mortgage terms will be more or less than this, and the
figures generated may be different from the actual costs if the term changes.
2. Unless you have entered an interest rate, the interest rate used for the calculation will be 6%. General interest rates offered by lenders tend to increase in line with the Bank of England base rate. We’ve shown what happens to your repayments if your interest rate increases up to 9%.
3. The figure calculated to show the possible mortgage value available is based upon 4 times the annual salary of a sole applicant and 3.5 times the annual salary of joint applicants. Different lenders will offer different income multiples that may be more or less than this and the total amount offered will depend on your particular circumstances.
4. Before purchasing a property, you will need to have money for some or all of the following:
- the deposit
- a valuation survey for your mortgage lender
- legal fees
- stamp duty (whose rate may vary from time to time)
- mortgage indemnity insurance (if required)
- removal costs
5. You will also be responsible for paying other property-related costs such as council tax, insurance, utilities and fixtures and fittings, and should remember to budget for these. Some leasehold properties also require you to pay service charges.
6. The rental figure is worked out at 2.75% of the remaining share of the property price after carrying out the above calculations.