Shared Ownership Allocation Policy

Our commitment to you

We will ensure we are following the latest guidance as published by Homes England and outlined within the Capital Funding Guide.

We aim to ensure that all applicants are treated impartially and equitably, with no preferential treatment.

We will be transparent by providing clear guidelines and communication regarding our process, enabling all applicants to understand and easily access our policies and procedures.

 

Scheme Eligibility

We follow eligibility guidance provided by the Regulator of Social Housing. In general, to be eligible for shared ownership, applicants should:

·         Have a gross household income of less than £80,000

·         Be unable to purchase a suitable property for their needs on the open market

·         Not own a home in the UK or abroad – or be sold subject to contract with proof e.g. a Memorandum of Sale

 

Applicant Priority

We recognize demand for our shared ownership homes often outstrips supply. We have a clear allocation process to ensure transparency. We follow current regulatory guidance and offer our shared ownership homes on a first come, first served basis.

 

Our first come first come, first served policy starts once an applicant has passed their full assessment and made a confirmed reservation.  

 

We reserve the right to hold a property for a limited time if an applicant requires special consideration and cannot complete the assessment process in the usual timeframe.

 

Non-grant funded homes are allocated on a separate basis:

 

1.      Enable CKH to meet the average first tranche sale target as determined by CKH’s Growth Board

2.      Provide the completed paperwork to allow us to proceed – First come, first serve

 

In some instances, there may be additional rules dictating the allocation of our properties. This can include, but is not limited to:

 

·         A local connection requirement, where applicants have to live or work in a specific locality to qualify.

·         Applicants in certain jobs may take precedence, such as working for the Ministry of Defence.

 

In these cases, applicants that fit these criteria will be given priority.

 

Surplus Income

We have a duty to ensure that when we are selling a home through shared ownership, the applicant can demonstrate that they have sufficient income remaining, after living costs, to ensure they are not putting themselves at risk with their purchase.

We work with specialist shared ownership mortgage brokers to qualify and financially assess each applicant prior to them reserving a shared ownership home.

In addition, we follow the Homes England guidelines to ensure any potential purchaser has a safety net of surplus income and is not over-reaching in their purchase and putting themselves in financial risk.

Our required minimum surplus income is 10%. Where a share below 25% is purchased, the surplus income requirement will be 20%.

This is the minimum amount of your gross income that you should have remaining after commitments.

How surplus income is calculated:

 

1.      Item

2.      Example/Explanatory Notes
  1. Gross Income

·      Gross monthly pay to include the relevant amount of any overtime, commission or bonus as determined by a specialist mortgage broker.

·      Any Universal Credit or benefit income

·      Any guaranteed maintenance payments
  1. Gross Deductions

·      Income Tax

·      National Insurance

·      Pension Contribution

·      Student Loan

·      Other payslip deductions
  1. Commitments

·      Credit commitments to include personal loans, PCP, HP, etc

·      Credit and store cards

·      Childcare costs

·      Care costs
  1. Housing Costs

·      Stress tested rental figure

·      Service charge
  1. Net Income for Mortgage Purposes

3.      E is the remaining income once B, C and D have been deducted from A
  1. Mortgage Payment

4.      The indicative Mortgage Payment as determined by the advisor.

5.      Where possible, the Mortgage Payment (F) should not exceed 30% of E

6.      NB: This may be exceeded in cases where the advisor feels that there is a justification for doing so and where the customer is still subsequently able to satisfy the provider’s budget surplus policy.
  1. Essential Costs

·      Council Tax

·      Utilities

·      Food

·      Fuel and Travel

·      Insurances

·      Other
  1. Surplus Income

7.      This is the figure remaining once F and G have been deducted from E. This figure should be at least 10% of the original figure A (gross income).

 

Adverse Credit

This policy applies to all prospective buyers who may wish to purchase a shared ownership home from Cross Keys Homes

Cross Keys Homes uses external specialist mortgage brokers to financially qualify each prospective purchaser. In addition, we have set guidelines to follow which determine the suitability of any potential purchaser:

 

Missed mortgage/rent arrears

If this happened in the last 12 months, it will not usually be accepted. We may, however, consider through an Individual Assessment

Unsecured arrears

We will need to carry out an Individual Assessment.

County Court Judgements (CCJ’s) or registered defaults

They may be acceptable only in the following situations:

·         All CCJ/defaults were registered more than 3 years ago and satisfied prior to mortgage application

·         All CCJ/defaults were satisfied more than 12 months prior to application regardless of date of registration

Individual voluntary arrangement (IVA) and discharged bankrupts

IVA/bankrupts who have been discharged over three years ago and who have no residual debt may be accepted subject to an Individual Assessment.

Repossessions

Not acceptable.

Adverse credit lenders

Cross Keys Homes do not accept 100% LTV lenders.

We look at cases on a case-by-case basis where demand is low.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Further information:

Who is responsible for managing the Shared Ownership Application Policy?

This policy is the responsibility of the Sales Manager, reporting into the Director of Corporate Services.

Legislation and regulation

This policy is written in accordance with the following regulatory and legislative requirements:

·         Capital funding guide: https://www.gov.uk/guidance/capital-funding-guide/1-help-to-buy-shared-ownership

 

Information sharing

Cross Keys Homes has an information sharing agreement with key agencies and contractors to share information in relation to the delivery of our services. Information shared must be relevant and the Data Protection Procedure adhered to when handling data. You can find more information about how we manage your data in our Transparency and Privacy Policy .

 

Monitoring and review

The Shared Ownership Application Policy was written and approved in August 2024 and will be reviewed every year – next review July 2025.