Precise Mortgages, part of OSB Group, has updated its affordability calculation process for its improved residential range, boosting borrowing capacity.
Precise said the changes to its affordability calculation would increase average borrowing capacity by around 9%, but this could be higher “depending on customer circumstances”.
The affordability calculation process includes reductions in assumed living expenses and costs for dependants, as well as updating income tax and national insurance contributions. This is on top of the existing promise to exclude child commitments in calculations.
The enhancement means that there are increased financial options for brokers with residential customers looking to get onto the housing ladder or secure additional funds for those seeking to remortgage.
An example of an affordability calculation process change would be a two-year fixed residential purchase rate Tier 2 product on a 30-year term at 74% loan to value (LTV).
Applicant A has an income of £45,000 and applicant B has an income of £40,000, and they have two children and £175 monthly payments on £3,675 credit card debt.
Introducing Lloyds Living
Sponsored by Halifax Intermediaries
The maximum loan previously was £298,365, whereas the maximum loan under the new affordability calculation process is £403,365.
Adrian Moloney (pictured), intermediary sales director at OSB Group, said: “I’m really pleased we’re now able to offer greater affordability through these calculation updates which are backed up by the strong residential range which we launched last week in Precise.”
“These changes underpin our commitment to helping our brokers navigate around the inflationary pressures that affect their residential customers’ affordability and is an area that we’ll continue to focus on.”
