Conversation With Homes England (January)

Response from Homes England is as follows:

Homes England has not stipulated in its guidance a maximum level of savings that a customer is permitted to retain. One of the primary goals of the updated affordability guidance is to ensure that the individual circumstances of an applicant are better reflected in their financial assessment in line with the general principle established in paragraph 6.1.9. This may be more applicable to cash buyers and customers similar to those given as an example in the question, but the principle is equally applicable to all purchasers.   

Cash purchasers should be assessed in accordance with the guidance contained in paragraph 6.10. Based on the question, on the surface the applicant’s request / wish does not align with the guidance for cash purchasers, in that they are seemingly able to obtain a suitable and affordable, albeit small, mortgage until such time as they retire based on their assessment. This should be considered by the provider in making their decision.  

In terms of determining what an appropriate level of savings may be, this is set out in paragraphs 6.10.7 and 6.10.8. In essence this is a judgement call for the provider to make based on the feedback from the advisor and the rationale provided by the applicant for wanting to retain a particular level of savings. If providers are unwilling to accept this rationale, they are able to decline the application under the provisions of both paragraph 6.10.1 and 6.10.8. Correspondence regarding this should be saved on file along with the completed affordability assessment.