Can my fiancé get a mortgage on his own?

DEAR GARETH,

I own a property. I’m engaged and due to get married soon. My partner and I would like to buy our family home, however the plan is for my husband to purchase this as a single applicant, whilst I keep my flat, which we will rent out. Would my partner be able to get a mortgage on his own, if I will be living with him and also being a homeowner?

Name supplied, via email. Gareth says…

There are lots of factors that banks and building societies use to work out how much they will lend you, and whether they will lend to you at all. It will take into consideration your outgoings, your liabilities (such as debt repayments or financial dependents), but your income is a critical figure when calculating the size of the loan you can get.

Lenders often use an ‘income multiple’ that determines the maximum loan you can get. Typically, this is between three and five times your salary. The bigger the deposit you have to put down, the higher the income multiple might be.

Some lenders offer larger amounts to people in certain professions or those with higher earnings. For example, some ‘professional’ mortgages will let borrowers with specific jobs (such as doctors, dentists etc) borrow five or five-and-a-half times their salary.

Income can come from lots of sources. Mortgage lenders may look at gross salary, but also income from savings, rental income and annual bonuses. But crucially, they only consider the income from the applicant. So, if your fiancé is the sole applicant on the mortgage, only his income will be taken into consideration by the lender, which may limit the total amount you can borrow.

For example, if your combined income was £80,000 a year and you were putting down a 20 per cent deposit, the amount you could borrow would jump to £360,000. That would allow you to purchase a £450,000 property.

If your fiancé’s income were sufficient to purchase the type of property you want to buy, there are some financial advantages – the main one being that he can benefit from a large discount on stamp duty. In England and Northern Ireland, first-time buyers pay no stamp duty on the first £300,000 of a property and five per cent on the amount between £300,000 and £500,000.

That is a significant discount compared to home movers or people that have owned a property in the past, and could save your fiancé up to £5,000 on his bill.

If you were planning to complete the purchase by June 30, you could save even more, as there is currently a stamp duty holiday as a result of the pandemic. You pay nothing on the first £500,000 in England and Wales, and zero per cent on the first £250,000 if you complete after June 30 but before September 30.

There has been a similar holiday for buyers in Wales and Scotland, offering zero per cent on the first £250,000. This is due to end on March 31 and at the time of going to press, it has not been confirmed that a similar extension has been applied in Wales and Scotland, although it looks likely.

If you were to buy together

Some lenders offer larger amounts to people in certain professions.

jointly, you would not benefit from the stamp duty relief for first-time buyers. That’s because it is only available to people who have never owned a home – even if you sold your property, you wouldn’t get the discount.

And if you marry before you buy, not only would your husband not get the first-time buyer discount, you’d also have to pay an additional three per cent in stamp duty (four per cent in Scotland and Wales) as you already own a property and HMRC treats married couples as one entity for stamp duty purchases.

I would recommend an independent mortgage broker. He can assess your situation and help find the right mortgage deal for your needs, and has access to deals you don’t get on the high street. Find out more at which. co.uk/mortgagebroker.

IT’S A strange quirk of history that John Doerr isn’t a household name.

Technophiles, entrepreneurs and management experts have heard of him, but otherwise he remains relatively obscure.

Doerr is a venture capitalist – he backed Google in the early days. But what really makes him interesting is his other contribution to the success of the internet giant – and countless other companies and organisations besides.

Doerr introduced Larry Page and Sergey Brin to a system for driving and managing growth that has ultimately led Google to become one of the most valuable companies in the world.

He is the creator of a management methodology called Objectives and Key Results – OKRs for short.

Don’t let the bland title fool you: this is the stuff of legend. The full explanation is in Doerr’s book Measure What

Matters – which I’ve just finished reading – but here’s the short version.

OKRs are a way of focusing the efforts of everyone in your organisation on the same important things that generate growth.

The ‘Objectives’ are the goals – achievable yet inspirational. The ‘Key Results’ are how you know you’re making progress towards those goals.

These are always numberbased, measured regularly, and a combination of short-term and long-term ambitions.

Doerr describes OKRs as “a vaccine against fuzzy thinking”.

Regular readers of this blog will know that BigChange recently took on a strategic investor, and that we are now on a growth journey that I believe will take us from a valuation of £100m to £1bn.

OKRs will be vital in the pursuit of this ambitious goal.

BigChange wants to become a global leader in field service management – both in terms of growth and by reputation BigChange wants to deliver all our services to customers in a frictionless way

Build the BigChange network and empower other businesses to grow

There are key results associated with each of these goals. Everyone in the management team has their own list of OKRs, and we have processes in place to keep all of us accountable.

The idea is to distil everything we want to achieve into a structured approach.

Don’t make the shopping list too long: the team needs to feel excited and empowered to reach these goals, not overwhelmed.

Alongside Google, Intel, the Gates Foundation – even U2 – have used OKRs to achieve their goals.

It is so humbling to be taking our first steps along this journey.

I’ve shared these OKRs with you, so that any other business owners interested in this process can get some insight into our approach.

I’d love to hear about your experiences with OKRs too. In a few years, I hope I look back at this post and think: “That was the turning point. The time our growth trajectory reached a new level.”