Affordability will be key in 2023

Alison Pallett, Sales Director at The Nottingham, said:

"I think we’d all agree that 2022 has been a truly tumultuous year for the mortgage industry. And while the worst of the chaos from September’s disastrous ‘mini-budget’ seems to be over, the reality is that millions of households in the UK will really be feeling the pinch in 2023.

"With inflation already pushing up the cost of heating and eating, the sharp rise in interest rates from September will be another shock when homeowners get to the end of their fixed-rate deal – and those hoping to buy their first home or move up the property ladder are likely to find that their borrowing power has significantly reduced.

"So, in 2023, more than ever, how lenders deal with affordability is going to have a massive impact on whether or not your clients can make their home-buying goal a reality.

"At The Nottingham, we’ve always taken a generous and fair view of a borrower’s incomings and outgoings. For example, we make our affordability assessment based on real-time bank statements, rather than ONS data. It’s just one example of how we put the individual at the heart of our business.

"Lenders, brokers and borrowers are all likely to find 2023 a challenging year, but you may well be surprised at our affordability. There're some key points below or, if you want to put us to the test, why not try our affordability calculator and see for yourself?"

Affordability – how we’re different

Self-employed – latest year 
  • We look to use the latest year's self-employed income, within a 20% fluctional. If there's more than a 20% fluctuation, we'll need to write out to a suitably qualified accountant for a projection, which we'll use for sustainability of the latest year.
No minimum income for BTL
  • The applicant will need to have suitable income to input into the application but there is no minimum and we don't ask for documentation.
Same ICR for higher/lower rate taxpayer
  • Whether it’s limited co BTL or personal BTL, we use the same ICR calculation for both higher and lower rate taxpayers.
Flexible deposit and concessionary purchase
  • For limited co BTL we accept director's loans.
  • If your client is buying from a family member, equity can be gifted where the transaction goes through at full market value.
Personal BTL income
  • We can take UK land and property for income purposes. The applicant will need to provide three years of SA302s and TYO and this will be loaded into the application as net profit.