In estimating the likely monthly cost of any new mortgage, we have run the information you entered into the calculator and have applied a representative mortgage rate based upon your Loan-to-Value of your existing mortgage and the new share. Thus calculating a realistic value for applicants to gauge affordability. However, we must emphasise that this is no guarantee that in practice you would be able to apply for such a rate, nor is this a recommendation that the rate used would be the best product for you because you would have to take into account a range of items when choosing a mortgage, such as fees.
The other elements used to calculate the monthly cost include:
1. A representative mortgage rate based on the following Loan-to-Value rate of your required mortgage. Which is based upon loan period of your choice and the current value of your home less the current value of the share of your home that you currently own.
Loan-to Value rates:
70% and less is equal to an estimated mortgage rate of 3%
75% is equal to an estimated mortgage rate of 4%
80%-90% is equal to an estimated mortgage rate of 5%
95%-100% is equal to an estimated mortgage rate of 5.99%
2. A yearly rental cost based on the current value of your property, less the current value of the share requested, multiplied by a representative 2.75% rental rate, divided by 12 (months).
3. An estimated service charge which will remain at the same rate that you currently pay.
4. Affordability is assessed as your total gross income divided by the estimated new monthly mortgage, cost, and rent (calculated using current value of a new share less current equity, and any additional finance). Approval rates are based upon a 45% or less spend on gross income.
Please Note: All figures are a guide only - you must obtain advice from a qualified advisor, which will be part of the process once you have contacted Origin Housing via the 'Apply' page.