Affordability for Shared Ownership

Every shared ownership applicant for a Stonewater property is required to meet Stonewater's minimum surplus income requirements. This is the minimum amount of surplus income that an applicant should have available per month after accounting for housing costs and all commitments, as established by a budget planner – at present, we define the minimum amount of surplus income per month as 10% of net income after all commitments, including housing costs.

All Shared Ownership applicants, including cash purchasers, will be directed by Stonewater to a suitably qualified and experienced advisor that is regulated to give mortgage advice for a financial assessment, and completion of a budget planner will be carried out free of charge. Applicants are not obligated to arrange a mortgage with the advisor undertaking this financial assessment.

Stonewater places no restrictions on applicants with a limited deposit or who are reliant on benefits; the individual circumstances of applicants will be considered in any assessment. Please note Stonewater will also reference our adverse credit policy where relevant.

Stonewater operate a two-stage process regarding affordability assessments which is carried out by a suitably qualified mortgage advisor.

Initial assessment (Stage 1) This initial assessment stage would be a high-level check that an applicant is:

• likely to be able to purchase the minimum share for new Shared Ownership homes (or the share being sold on resales) and;
• meets Stonewater’s policies in relation to the selling of Shared Ownership homes
• mortgage payment should be no more than 30% of net income after all commitments, housing costs

Full assessment (Stage 2) This is a more detailed assessment of income and expenditure and will involve a budget planner. Applicants will have to supply relevant documentation to support their application.

The purpose of this stage is to arrive at a share purchase that is suitable for the applicant in terms of their affordability and sustainability. In completing a budget planner, the advisor will ensure that the applicant has met Stonewater’s minimum surplus income requirements of 10% of net income after all commitments, including housing costs.

Applicants will be encouraged to purchase as large a share as is suitable based on their individual circumstances – however, applicants are permitted to retain a reasonable level of savings for emergencies, as well as to cover known foreseeable events to avoid them becoming overcommitted financially. Where applicants have a surplus income of more than 20% or the mortgage payments are less than 20% of net income after all commitments and housing costs, we may undertake a review to ensure customers are taking the optimum share they can afford.

• If you do not meet one or more of the eligibility criteria for the shared ownership scheme you have enquired about, your application will likely be declined by Stonewater, for example:
  • you are unable to meet the requirements of the affordability assessment
  • you are unable to meet one or more of Stonewater’s policies
  • or you are unable or unwilling to provide the required information or documentation.
• If you wish to purchase a different share level from what your affordability assessment was approved at, either higher or lower, you must provide a justifiable rationale or reason as to why you are choosing to change. Stonewater can either offer a different share level to from what you would prefer or we can decline your application.
• Below is a list of the various elements of the shared ownership application and assessment process, we have listed which organisation you will be dealing with throughout the process and their responsibilities. Also, below is where you can raise queries, questions and complaints should you need to.

Application / Assessment Process	Who is responsible
Customer eligibility and prioritisation	MP (on behalf of Shared Ownership Provider) chirpy@tmpmortgages.co.uk
Financial assessment of affordability	Stonewater newhomes@stonewater.org
Decision to accept or decline an application and at what share level	Stonewater newhomes@stonewater.org
Application of Stonewater’s specific policies	Stonewater newhomes@stonewater.org
Mortgage advice (if requested)	Mortgage broker / advisor (acting under their own FCA regulation)
Complaints regarding application or share decision	Stonewater newhomes@stonewater.org
Complaint regarding mortgage advice	Mortgage Broker’s / Advisor’s own complaints procedure

Credit report – Please make sure that you send the full report, not just a summary page or your overall score (the full report will show your payment history, and that’s a really important bit for us). You use Check my file - Get Mortgage Ready as that report covers three credit reference agencies (which means you don’t have to get multiple records). It’s free for the first 30 days and then £14.99 a month. If you don't want to keep the subscription, you can cancel online at any time during the free trial. Click here to access your file: Get Mortgage Ready.

An in-date passport or photocard driving licence – You will need this for Credas (the identity checking part of the process), and we’ll send you an email about how to do this when we need this information. If you are in the UK on a Visa, we will need a copy of that too.

Payslips from the last 3 months – These will need to be from the most recent 3 months (and not just any 3 that come to hand).

OR, if you’re self-employed - last 3 years’ SA302/Tax Calculations plus Tax Year Overviews for the last 3 years. These can be downloaded from Get your SA302 tax calculation - GOV.UK make sure you complete these, too. If there’s any missing information, it just won’t be enough.

Most recent bank statements from all your accounts for the past 3 months – Downloads are just fine, but they must show your name and address on them, and make sure it’s ALL your accounts including any savings you have.

Latest Council Tax bill or a utility bill – Not named on the bills? Don’t stress, just let us know when you send us the other documents and we won’t keep asking you for it (top tip: It’s always worth getting registered as it makes that all important credit score look a little bit better).

Proof of deposit – If you are lucky enough to be receiving a gift from a family member, we are going to need to see proof of those funds, too. Please let them know we are going to need 3 months of bank statements that show the money in their account.

Credit card statements – If you have one, we’re going to need to see the most recent statement – you can normally download these from your card provider’s website. Or if you still get them through the post, take a nice clear photo of it and send that over.

Proof of benefits – If you receive any government benefits like Tax Credits, Universal Credit or anything similar, we’re going to need to see the statement to show what you get and when. That means ALL the pages you get will need to be sent over to us, and again, a nice clear photo will be fine.

Evidence of maintenance payments (either way) – If you’re receiving payments, or paying them, we’re going to need to know about them. If you have them agreed by Court Order, please let us know that is the case, send us a copy and let us know what to look out for on your bank statements. If they’re not court ordered, let us know how long you have been receiving them for, and what they are showing as on your bank statements.

Copy of your Agreement in Principle & KFI – Don’t have them? TM will be able to help on this.

*£12 will be paid by Check My File to TMP The Mortgage People which is an appointed representative of Mortgage Advice Bureau Limited and Mortgage Advice Bureau (Derby) Limited. Mortgage Advice Bureau Limited and Mortgage Advice Bureau (Derby) Limited does not receive a share of this commission and has no direct affiliation with Check My File.