A leading mortgage expert reveals the one easy step you should do after your split that could see you better off when it comes to mortgages.

Getting a mortgage has become tougher in recent years, with the cost of living crisis seeing approvals for mortgages to buy homes down by 20% at the end of 2022 - and with divorces up by nearly 10%, this is a scary time for couples who are separating and don’t know where they stand financially.

However, not all is lost as mortgage expert Sian Thomson, the co-founder and director of Prestige Mortgage Solutions, reveals an easy step you can take to better understand your chances of getting approved for a mortgage that’s right for you after your split:

“A lesser known way of understanding your chances of mortgage approval after your split is by asking for a Mortgage Capacity Report. This simple report can detail the dramatic differences in the amount that you may get from multiple lenders, help you settle financial issues in court, plus give you a clear idea of where you stand now you're on one income. This means you are more likely to understand the offers that are within your means, fit your individual circumstances, and give you peace of mind.

” Here Sian shares more details about Mortgage Capacity Reports, and how taking this easy step may be the answer to your post-separation mortgage woes.

What is a Mortgage Capacity Report? A Mortgage Capacity Report is a document that shows a lender how much money a person might be able to borrow for a mortgage based on their specific circumstances after a split i.e. income, savings or responsibilities. Sian explains:

“This report is more thorough than just checking your bank. You’ll undergo a short questionnaire by a qualified mortgage broker who will get all of your needs and outgoings down on paper. This will then be used to see what level of mortgage you are able to afford, and how this will affect who takes ownership of the family home.

” To create this report, your mortgage broker will look at things like:

■ Any outstanding loans or mortgages you already have, individually and together.

■ The value of any property you already own.

■ Your current income.

■ In or outgoings such as child support or spousal maintenance.

■ Your retirement plans.

You will then be given a Mortgage Capacity Assessment Letter that will detail which level of mortgage you are most likely to receive approval for, helping streamline the process and allowing you to plan for your new future.

Is it worth it? Sian believes that more potential homeowners should think about getting a Mortgage Capacity Report before they start their divorce journey, with it making the process much smoother and far more equitable to the parties involved:

“Not only do Mortgage Capacity Reports make it easier to understand your capability of getting a mortgage during this difficult time, but they’re also far more reliable than just going to a bank or lender, who don’t always provide a mortgage offer that is a true reflection of what you can pay based on your circumstances. This is especially true if your income is not from a main basic wage, such as from maintenance, bonuses or benefits. This can help make the tricky process of fighting out your future living arrangements that much easier, and can go a long way in court in helping you get a separation that is fair and equitable, and won’t ruin your dreams of homeownership.”

They’re more accurate A Mortgage Capacity Report is far more thorough than just visiting your bank or a lender, who will often use affordability calculators to determine which mortgages you can be offered. These will often miss out on certain key details about your life, meaning you may be offered mortgages that are far too high or low for your needs after your split. An experienced broker will be able to assess all of your relevant finances and provide you with an accurate figure with detailed justification why, helping your case for approval, or even spousal maintenance.

They’re credible A Mortgage Capacity Report gives you greater financial credibility when dealing with lenders, with any figures backed up by the expertise of your chosen mortgage broker. This is the perfect option for when an individual’s financial circumstances might be complex or unusual, especially after a split, such as if they have many sources of income, are self-employed, recently changed jobs, or have historically bad credit.

They’re convenient Going through a separation can be a busy and incredibly taxing time, especially if children are involved. A Mortgage Capacity Report can help where a client does not have the time or ability to trawl the high street banks or complete various lenders' affordability assessments to help their case.

They can help you in court These reports won’t suggest specific lenders but will document the maximum recommended amount you can borrow, project your rate of repayment using current market interest rates, as well as other mortgage costs. They will also factor in things that could affect your mortgage capacity, like any potential financial settlement, amounts of maintenance or deposits for a property.

This makes them a great tool when it comes to your time in court, with the Judge able to use this report to make decisions regarding your finances, including to help settle any disputes that may arise during the proceedings such as who gets the family home, or who pays spousal support.

If you’re struggling to know where you stand after a divorce, getting a Mortgage Capacity Report could be the exact step you need to finally get the ball rolling, and get your mortgage journey on track:

“With the average Mortgage Capacity Report between £300 - 500, I think it’s a worthwhile investment when going through a divorce or separation. Time is of the essence when it comes to negotiating your divorce and any mortgage responsibilities, so improving the strength of your case can make all the difference, and a Mortgage Capacity Report could be the very thing you need to help you move on.”