Own Home Scheme Pros and Cons

zoomy

I am in the NW, applied before Christmas and was told the appointment book was oversubscribed and there would be a long wait. They contacted me by post on the 1st June, I had the telephone interview on the 3rd June and spoke to the co-op the same day.

I've been warned all along that the North west fund pot is running out but fortunately I've found a property I like pretty quick - I've got an offer accepted and applied for my mortgage yesterday so am just playing a waiting game now!

I find it awful not knowing if you've got the funds until after your offers approved - I'm trying soo hard not to get too excited in case I can't get the funding but it's not easy!

ladybird3

Finally had my phone interview with both Ownhome and the Co-op this lunchtime-16 weeks of waiting (originally quoted 6 but hey!) got there in the end! :j

Both the people I spoke to seemed very helpful and knowledgeable, the interviews were quite long but very thorough-make sure that when you have yours you have to hand your payslips, employers address, and your national insurance number.

Ownhome take all your details including any debts, where you want to live, your earnings etc etc and then give you the criteria which includes: Max bedrms, MINIMUM mortgage that you're obliged to take from the co-op, and MAXIMUM value of the property. Don’t worry if the minimum mortgage seems small-they said the co-op would almost certainly lend more but that ownhome have to stipulate an absolute minimum that they expect you to borrow. The maximum value of the property as far as I can see reflects the average house price in your area for the amount of bedrooms you’re allowed so isn’t really reflective of what you can actually buy I guess. For example, I live in central London (Islington) and want to buy in this area therefore the maximum property value they set for me is £383k:eek:-I WISH! But that is just reflective of current prices in the area for a 2 bed property.

They then tell you the % they will lend you. I’m not sure if this too differs area to area but for me said I can have anything between the 20-40% in 5% increments. Though at first glance this may seem like you have to put an offer for an absolutely specific price the guy explained that’s not the case as you just adjust the mortgage side of it accordingly.

They then give you a reference number for the co-op who do a similar interview and give you the exact figures. The specific mortgage you can get depends on the % that you decide to take from ownhome as clearly that bit acts as your deposit essentially. So for example, if you take the full 40% from ownhome you need a mortgage with a loan to value ratio of 60%, the interest rate you’ll get therefore will be better than if you take only 20% from ownhome and need an 80% loan to value ratio from the co-op, does that make sense?!
You still get the same choice of the mortgages as someone coming from outside the scheme with a deposit.

For me personally the co-op have said they’ll lend me £115k for a mortgage which means I can search for a property value of up to £190k give or take a couple of grand (40% of 190k is 76k, 190k-76k=£114k)
Sounds like a lot but it’s not going to go far around these parts!! Point is it will get something that belongs to me and that’s what’s important :T


Sorry to ramble on but I think it’s useful to know how the process works for those who haven’t quite got to the interview stage yet, off to the estate agents tomorrow so will keep you posted. Oh and also they said currently there are around 6000 people on the waiting list hence the long wait-try to be patient people! :rolleyes:

tek-monkey

Can someone just confirm how they work out the number of rooms you are allowed? I have been told by one person that it is the number of people on the mortgage + 1, and another said it goes on one bedroom per person moving in. I live with 2 people (my brother and a mate), both of which would come with me. Financially though I can't have either on my mortgage, as neither has good credit.

Therefore I'll be buying as a single person, but with 2 guaranteed lodgers for the first year or so at least. My mate will be off within 2 years, but my brother is likely to stay for the forseeable future. If the mortgage just goes on me, I may as well carry on renting as I enjoy living with them.

ladybird3

I think as a single applicant you're allowed one more person? so if it's just you applying you can have 2 beds. . .i think!

tek-monkey

Poo, be no good for me then

ladybird3

depends how badly you want to live with your mate versus getting a foot on the ladder i suppose!

superfran_uk

tek-monkey wrote: »

Can someone just confirm how they work out the number of rooms you are allowed? I have been told by one person that it is the number of people on the mortgage + 1, and another said it goes on one bedroom per person moving in. I live with 2 people (my brother and a mate), both of which would come with me. Financially though I can't have either on my mortgage, as neither has good credit.

Therefore I'll be buying as a single person, but with 2 guaranteed lodgers for the first year or so at least. My mate will be off within 2 years, but my brother is likely to stay for the forseeable future. If the mortgage just goes on me, I may as well carry on renting as I enjoy living with them.

It would only let you have extra people if they were dependents or on the mortgage, I am sure. It just wouldn't be fair otherwise. If you could do this, we'd all buy mansions, let all the rooms out and make a fortune!

Also you would need to ask their permission before you could let out rooms, and you'd have to declare it for tax purposes I believe.

tek-monkey

superfran_uk wrote: »

It would only let you have extra people if they were dependents or on the mortgage, I am sure. It just wouldn't be fair otherwise. If you could do this, we'd all buy mansions, let all the rooms out and make a fortune!

Very fair point. Well, 60% still needs a mortgage on but obviously I could go WAY beyond my means otherwise. I can get a large 4 bed terrace down the road from my mum for what I can afford plus 40%, which would be taking the **** a bit. Maybe I should see if I can get a mortgage with my brother after all, and lose the mate. Dunno, like I said I like living with them.

Other consideration is my GF has 2 kids, and we have been together 18 months. She owns a house already, albeit with a mortgage, which is too small for me to live in as well. I suppose I could always grow up and get a place with her. Scary idea though!

cowgirlmoo

I applied for ownhome end of March and am still waiting - i'm hoping it will be around July to get my interview.

My partner has just been made redundant so i'm guessing i will have to apply on my own now, not sure what happens in this situation.

The house we want is only 90K - hopefully get it for around 80k so not very expensive but we have saved for over a year just to get the 3k to pay the fees so need ownhome for the deposit.

I'm hoping that they will give us 20k and i can get a mortgage for 60k so that our mortgage payments are quite low and we can pay off some of the loan (other then this i am planning to sell the house after 5-10 years for a profit and pay it back)- this sounds like a small amount compared to what other people are asking for so hope this doesnt go against me.

We only have my wage of 15k at the minute so well below the 60k limit. We're not key workers but are first time buyers.

Do you think we will have any problems?

I've had some store card/overdraft problems about 1-2 years ago but they are all cleared up now so i'm hoping these wont affect my credit rating!

One thing i need to do is get on the electoral role for the address i'm at at the moment as i'm told this might affect them tracing my credit history?

Thanks guys!

HomeBuy3780

Anyone know what happens if I don’t have UK permanent residency? This means I don’t have indefinite leave to remain. Am I eligible for ownhome scheme?