The buying process

We operate a first-come, first-served policy that will initially prioritise any qualifying armed forces personnel, as defined by the Homes England Capital Funding Guide and any protected sites or areas where we're required to give priority to applicants with some form of local connection.

At the next level of prioritisation, Clarion will ensure that all applications to purchase a shared ownership property meet the affordability guidance as detailed in the Capital Funding Guide. On this basis, we'll operate a first-come, first-served process that prioritises those buyers who have undertaken a detailed affordability assessment, carried out by our qualified and regulated panel mortgage advisor, who has determined the appropriate affordable share that the applicant(s) can purchase. This will ensure that decisions made about eligibility and affordability are made in a fair and consistent manner and that all applicants meet the criteria set out in the Capital Funding Guide.

The detailed affordability assessment will involve the applicant(s) providing all the required documents, including a valid Agreement in Principle from their chosen mortgage lender. The allocation process will be done in order of the applicant(s) completing this assessment, referred to as the sign-off process. The panel mortgage advisor will be transparent and open in providing a detailed and reasoned explanation as to what documents need to be provided and how to do this at the point of initial enquiry.

Clarion will ensure that all cases meet Homes England affordability guidance as detailed in the Capital Funding Guide. Ensuring all purchases are affordable and sustainable. Further guidance on the methodology for assessing applicants can be found at 1. Shared Ownership 6B.7.8 in Homes England Capital Funding Guide.

The extract below, from the Capital Funding Guide sets out the methodology for assessing applicants:

• (A) Gross income
• (B) Less gross
• (C) Less known commitments (loans, credit cards, childcare, etc.)
• (D) Less housing costs of the Shared Ownership purchase (rent and service charges)
• (A-B-C-D) = income available to support a mortgage, other essential expenditure (identified through a budget planner) and to meet the provider's surplus income policy

We will work to the policy that the applicant must have a minimum of 10% of their net mortgageable income remaining after all deductions and the five-year stress-tested rent level has been applied as part of the assessment process.

In addition to the Homes England affordability calculation, we would also expect the applicant to have a minimum of 10% of their total net income remaining on the panel mortgage broker's budget planner. This falls in line with the panel mortgage broker's mortgage compliance affordability. The panel mortgage broker will advise of the appropriate share to be purchased based on our affordability policy and is unable to suggest a share that does not fall within these parameters, as we would not deem it affordable or sustainable.

This rule shall apply irrespective of whether the applicant is using the panel mortgage broker, or if they have chosen their own route. As part of the sign off, the panel mortgage broker will provide both calculations to Clarion to ensure that the purchase is both affordable and sustainable.

The affordability assessment is undertaken in two stages. The first stage will be based on the financial information that is provided by the applicant to the panel mortgage broker, who will provide an initial assessment based on this information. If the applicant passes the initial first-stage assessment, they will progress to a full assessment, that will require the applicant to provide documents to evidence the information provided in this initial assessment. The panel mortgage advisor can give you more detail around what documents need to be provided and how to do this at the point of initial assessment.

The 10% surplus helps to protect the applicant against possible increased costs or unforeseen circumstances that have not been budgeted. The panel mortgage advisor will be transparent and open in providing a detailed and reasoned explanation through the policy that we have set when providing the outcome of the assessment.

A more detailed presentation of the methodology and data examples can be found at 1.Shared Ownership 6B.7.8 in Homes England Capital Funding Guide in the budget planner guidance note.

The size of your deposit determines how much money you need to borrow. On an outright sale you normally need at least 10% of the purchase price as a deposit. But if you’re buying with shared ownership it can be even less as you only pay a deposit on the share value.

You can find out more about mortgages on the Money Saving Expert website. 

As well as the price of your home, you may have to pay for a range of things related to your home purchase and move. These can include:

• mortgage reservation fees
• surveys, valuations and local authority searches
• stamp duty and a land registry fee
• ground rent and service charges