What is a Mortgage Capacity Assessment?
A mortgage capacity report is an in-depth report detailing the amount and type of mortgage you are likely to get after a divorce or separation. Even though there is plenty of templates and guides on line each mortgage capacity assessment and report are different based on the client’s individual circumstance.
Why do I need a Mortgage Capacity Assessment?
The Capacity Report is most commonly used during divorce or separations. In most cases this is requested by the courts to do decide on financial splits of existing assets. This report will not only give you an element of peace of mind and allow you to plan your future post separation but will be able to detail different outcomes based on varying financial splits.
Who completes the Mortgage Capacity Report and Research?
The mortgage capacity report needs to be deemed as credible. At St Barts Finance we are an experienced mortgage brokerage and financial planner with the correct qualifications in place. This ensures that your mortgage capacity assessment is deemed as credible by solicitors and the courts.
Mortgage capacity assessment what’s involved?
This is completely dependent on your own personal circumstances and the complexity of your separation. There are many factors that can affect the outcomes of the reports and every potential scenario should be covered to ensure that you get a fair settlement from your separation.
What information should I know to help my advisor generate a mortgage capacity report?
There is some key information that you need to know to ensure that your report can be started. There is then the potential variable scenarios that you should consider, based on maintenance payments, child care and your current work situation (if that needs to change to support your family).
The financial information you should know is detailed below for your Mortgage Capacity Report?
Property Value – Understanding the value of your property is crucial in most cases the equity in their marital home and buy to let properties is their biggest asset. You can get a rough guide on property prices by using helpful tools on property websites like zoopla.co.uk or rightmove.co.uk. We would also recommend getting your property valued by a local estate agent who has a proven track record within your area.
Mortgage Amount – You will need to know the outstanding balance of any mortgages you currently have residential and buy to let mortgages must be included. Doing this is a simple task and you can ring your current mortgage provider(s) or log on to your online portfolio.
Investment Details – When building your capacity report your investments come into consideration. Not everyone has investments but if you do an up to date value or statement is beneficial when building a credible clear mortgage capacity report.
Pension Details – This is a joint total of pensions and the current values underpin many separation cases and pension is split as part of the financial settlement. This is something your solicitor will advise you on in more detail. Ringing your pension provider or HR department will give you the details of these funds and the values we need to complete your mortgage capacity assessment.
Income Detail – We would ask you to understand all earned and non earned income that you receive. This will allow us to build the capacity report and potential scenarios if you had to reduce or increase your working hours post divorce and how this would affect your potential mortgage borrowing in the future.
Potential Split – This is a question for you solicitor. Not that it will be set in stone but you and your solicitor will normally have a rough idea of how the assets are going to split. This is not always 50/50 as most imagine and is completely dependant on your individual circumstances.
What is a Mortgage Capacity Report Scenario?
Your report will include one scenario as standard after that you and your solicitor may decide you would like additional scenarios based on variants within the divorce or separation proceedings.
- Child Custody
- Maintenance Payments
- Benefit Payments
- Child Care Costs
- Working Arrangements
There are 100’s of potential scenarios that could happen when divorce/separations take place. You will not need a scenario for every possible outcome but working with your solicitor and your advisor at St Barts Finance we will be able to look at the likely scenarios that you could be faced with post-divorce.
Mortgage capacity report template
At St Barts Finance we have spent time developing templates and tools for you to use as informative guides when facing a separation. This includes mortgage affordability calculators post divorce and capacity assessments on line. Most of our client’s legal teams will ask to see Mortgage Capacity Report template to help you prepare for this stage and you can download that straight form our site. With this template you will be able to see exactly how your repot will be structured and the areas it covers.
Mortgage capacity calculator
We understand that in a modern age people want quick information especially when in times of uncertainty such as divorce or separation from their partner. We have developed a mortgage capacity calculator to give you a rough idea on what you may be able to borrow. This tool is free to use but is only a guide and as mentioned already in this article your Mortgage Capacity report needs to be thorough and credible. All our assessments and reports are carried out by a qualified Mortgage Advisor in one of our offices.
To speak to a qualified mortgage advisor in more detail about your Mortgage Capacity Assessment contact the team at St Barts Finance on 01202 520 550 or use our online appointment booking solution.
Mortgage Capacity Reports are not part of the Openwork offering and are offered in our own
right. Openwork Limited accept no responsibility for this aspect of our business. Mortgage
Capacity Reports are not regulated by the Financial Conduct Authority.