 |  |  |  |  |  |
 |  |  |  |  |  |
How the AFHOS Funding is Calculated
The funding you receive from AFHOS is based on the financial assessment we receive from your Independent Financial Advisor (IFA).
Working within the guidelines set by the Government and also the restrictions with mortgage lenders*, we then calculate your affordability based on the expectations you specified to your IFA - this includes looking at the maximum mortgage you can obtain, the deposit you have available (including LSAP if applicable), and the AFHOS equity loan.
Under all HomeBuy schemes you are expected to maximise your mortgage potential and use as much deposit as possible. The maximum AFHOS equity loan of £75,000 is only given when absolutely necessary as we want to help as many members of the Armed Forces as possible.
We will talk through the figures with you during your interview, ensuring that your maximum purchase price is suitable for your family needs and the area in which you want to live.
* Usually a minimum 5% deposit based on the value of the share you are buying, ie mortgage + deposit, and maximum Loan to Value (LTV) of 75% - LTV is the maximum a mortgage lender is prepared to lend against your property.
Of the three examples below, Example 1 is the only scenario that fits all the criteria discussed above.
In Example 2, the client has requested the maximum Equity loan, however this does not maximise the mortgage and the deposit is too low.
In Example 3, the client has requested to maximise the mortgage, but the LTV is too high and the deposit too low.
| Example 1 | Example 2 | Example 3 | |
| Applicant Expectation | £200,000 | £200,000 | £200,000 |
| IFA Proposed Purchase Price | £221,302 | £221,302 | £221,302 |
| AFHOS Proposed Purchase Price | £200,000 | £200,000 | £200,000 |
| Mortgage (min 3x, max 4x) | £139,300 | £120,000 | £159,000 |
| LTV % (max 75%)§ | 70% | 60% | 80% |
| Savings and LSAP for use as Deposit | £8,700 | £5,000 | £7,000 |
| Deposit % (as % of share you are buying - min 5%)§ | 6% | 4% | 4% |
| Deposit % (as % of purchase price)§ | 4% | 2% | 3% |
| AFHOS Equity Loan | £52,000 | £75,000 | £34,000 |
| Equity Loan % (min 15%, max 50%) | 26% | 38% | 17% |
§ percentages in these examples have been rounded to the nearest whole number
Privacy Policy | Terms & Conditions | Data Protection | Swaythling Housing | Radian Group© Radian Group 2012