Foundation Updates
How we assess land and property income on residential mortgage applications
For Residential (Owner occupier) affordability calculations, we take into account Profit from Land and Property LESS the finance cost.
When keying the DIP or mortgage application onto the portal, please key the profit from land and property figure LESS the finance costs. Failure to do so could result in reduced affordability once any application is assessed.
Our underwriters will take the net amount after finance costs as stated in the SA302.
Example:
In this example, the £79,561 gross rental income LESS £55,434 finance cost leaves £24,127 profit income for the affordability assessment.
This change will affect all new FULL mortgage applications and DIP conversion from Wednesday 18th January; pipeline cases will continue to be assessed using the existing criteria.
If you have any queries, please speak to our helpful IBDM team on 0344 770 8032
FOR INTERMEDIARIES ONLY
