Mortgage Capacity Reports
˚MORE THAN 50 HIGH STREET LENDERS
At St Barts Finance we pride ourselves on our mortgage and industry knowledge. We aim to provide a quality service across Mortgages, Pensions, Insurance and Investment.
As part of this, we offer clients and solicitors a Mortgage Capacity Report service
These are requested by clients or invariably their solicitors when the client is going through divorce proceedings and a report is required by the court that shows their capacity to enter into a mortgage contract.
This is usually based on their current situation and also on their future potential income, often not just their salary but any child benefit, tax credits, maintenance payments, etc.
During these assessments, we will also look at their current and potential future commitments
As an example of what we do, I recently produced an 11-page fully bound report for a client, who was referred by a local solicitor
We met face-to-face in one of our two main offices, (Bournemouth and Poole) and reviewed my client’s full current and potential future situations
I then reviewed my client’s information with them and sourced potential options from our lending panel. Each lender assesses income in a variety of ways. Lenders will usually use 100% of a client’s main income, but with certain income types, lenders may use 100%, 50% and some may use 0% depending on the income type that we are looking at and the lender’s criteria
This information enabled me to then compile my findings and produce my report
In this case, my client had maintenance payments to pay each month and these were factored into my calculations
Also, in this case, my client had a variable income and the ability to earn more or less, depending on the hours that they worked
So, I worked out their mortgage capacity on 3 different scenarios with a variety of lenders
This resulted in 3 results with the amount of borrowing for each clearly identified
In addition to this, I could advise on the maximum mortgage term for my client, the type of mortgage (be it on a repayment basis or an interest-only) and the best deal and product available in the current market that best suited my client’s needs and objectives.
Based on my advice from the lenders and deals available, I could then marry that with the best term and advise my client, not only on his affordability and mortgage capacity but also on the amount that he would need to pay each month on that particular deal
With a Mortgage Capacity Report, it is important to outline the options and match the scenarios so that my clients end up with the best option for them
It also means that the court in a divorce proceeding can assess the needs of each party to the divorce and can decide fairly on the best course of action
It also means that my client could budget and plan for the future, which in this case was the desired output of our meeting
Our reports are personalised and thorough and reflect the fair situation at the time the report is completed and also enable our clients to plan ahead with some reassurance
My client, in this instance, was presented with a variety of solutions to the options laid in front of me, as I say, based on their circumstances
It also meant that my client could plan for any potential maintenance liability and any variance in their income over the next few years
As far as I am concerned, this is a valuable service that we provide. It assists clients, their families, their solicitor and the courts
All part of the reason for assisting our clients with these reports
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