Own Home Scheme Pros and Cons

ladybird3

Steven I bet you find yours will be in the post within the next couple of days as it sounds like they're dealing with a few dates each day.
they were on 15th july yesterday then 17th-20th today so you're getting close, hang on in there!

Steven.Morris7

ladybird3 wrote: »

Steven I bet you find yours will be in the post within the next couple of days as it sounds like they're dealing with a few dates each day.
they were on 15th july yesterday then 17th-20th today so you're getting close, hang on in there!

well we've been quite lucky that the vendors solicitors and rubbish, so i've been able to blame them for the delays he he

mandy_s_2

ladybird3 wrote: »

you can choose from the full range of co-op mortgages-not likethere are specific ones just for ownhome customers however it will depend somewhat on the % you're taking from ownhome as obviously with a higher % you will need a lower ltv rate and therefore you may get a better rate of interest

Thank you so much for that ladybird!! That affected the offer I put in as I wanted a 75/25 split and the offer was accepted

Got the mortgage accepted and email winging it's way to ownhome to allocate funds. Now the "fun" begins....

ozzyozzy

Agbe wrote: »

Hi Ozzy,

We don't have our interview until the end of this week, so as yet I don't know what we'll be offered. But we have no debts whatsoever.

Do you have a date set for your interview yet?

YES ! I have mine next Wednesday - BUT to be honest I am seriously worried about the funding situation in London, but when i spoke to PFP today I seem to get the impression that other areas who are no longer eligible will have their funds transferred to London area. Thats the impression I got, although it does sound very odd ! I guess the best policy with all this is NOT to get your hopes high for this Ownhome scheme...Ozzy :rolleyes:

shanqs1

Hi Everyone here. I have been following this thread closely as I was registered back in April, and recently got an interview and was approved for the eligibility.

I should consider myself lucky for be able to take on the last train, but I have a serious dillema since, please advise:

I am from London, where the property market resists the most to the credit crunch, the figure shows that price has continuously gone up for the last 6 month in London, vendors are very persistant in getting their asking price, or very limited room to negotiate. But many experts, if not all, concluded that the temporary price rise was due to a shortage in supply, rather than the ease of the mortage, in conjunction with the historical high in unemployment number and general economic environment, they predicted at least a further 15% drop in london area in the next year despite of current rise.

Here is my problem: do I get myself onto this last train and buy at this potentially over-priced market, or just let it go and wait a further price drop, with the knowledge that I would not be able to afford what I could have should I optted with the ownhome scheme.

Let the figures talk: I am now casting my eye at a 285k house, with co-op promises 132k, I got at my side a deposit of 45k, plus 40% P4P loan, that pretty much works out this sum, but if price drop, this now 285k house could worth only 243k next year, I would go into neg equity; or I can wait till the bottom rock, miss out the ownhome scheme, get myself a conventional mortgage, with my deposit which could get to a total around 200k, but far less from the 243k (target price).

Not sure what to do now, but still keep looking for houses, just have such feeling that buyers are now crazy: very often when I phone up to arrange a viewing of a newly posted ad, EA responded "Sorry, it's just gone".

OMG, are we really in a recession?

ozzyozzy

shanqs1 wrote: »

Hi Everyone here. I have been following this thread closely as I was registered back in April, and recently got an interview and was approved for the eligibility.

I should consider myself lucky for be able to take on the last train, but I have a serious dillema since, please advise:

I am from London, where the property market resists the most to the credit crunch, the figure shows that price has continuously gone up for the last 6 month in London, vendors are very persistant in getting their asking price, or very limited room to negotiate. But many experts, if not all, concluded that the temporary price rise was due to a shortage in supply, rather than the ease of the mortage, in conjunction with the historical high in unemployment number and general economic environment, they predicted at least a further 15% drop in london area in the next year despite of current rise.

Here is my problem: do I get myself onto this last train and buy at this potentially over-priced market, or just let it go and wait a further price drop, with the knowledge that I would not be able to afford what I could have should I optted with the ownhome scheme.

Let the figures talk: I am now casting my eye at a 285k house, with co-op promises 132k, I got at my side a deposit of 45k, plus 40% P4P loan, that pretty much works out this sum, but if price drop, this now 285k house could worth only 243k next year, I would go into neg equity; or I can wait till the bottom rock, miss out the ownhome scheme, get myself a conventional mortgage, with my deposit which could get to a total around 200k, but far less from the 243k (target price).

Not sure what to do now, but still keep looking for houses, just have such feeling that buyers are now crazy: very often when I phone up to arrange a viewing of a newly posted ad, EA responded "Sorry, it's just gone".

OMG, are we really in a recession?

Hi there,

I am from the London area too, and your question is one that faces me too, I am due my interview next week with PFP, but feel the funding may well run out by the time all the technicalities are done. My opinion of the london property market is that most of the price falls have been done now. I doubt they will fall another 15% - although it certainly is true that prices have stabilised because of a lack of supply. But then again if one thinks about it logically, if this is maintaining prices, as soon as prices do in theory start falling again, won't people logically just not put their homes on the market again - hence lack of supply and prices stabilising ?! It is for this reason I think the bulk of price falls in London have occured already. My opinion is another perhaps 5% fall - and thats it.
I guess the answer to your question is a personal one really- like myself. I mean how desperate are you for your own home NOW ? Thats the real question, for me I need a place now and cannot wait really, so I will buy now and not wait for further price falls -IF they indeed happen.
But one thing i have to say is I am surprised you applied for the scheme when you have such a large deposit - the bulk of the people on this scheme have either small or no deposits. Are you saying you cannot find a place in London for less than £285k?! You could certainly get something nice for £250k, and the point is you have nearly 20% deposit, so obtaining a mortgage is not a problem for you.
To be honest with you, I am surprised you were eligible for the scheme, bearing in mind the size of your deposit you have, the idea of the scheme is really to help those that cannot raise a decent deposit, thats why they apply for this equity loan scheme - OWNHOME. They are in effect being 'given' deposits of 20-40%.
Anyway good luck in your search - Ozzy from N LONDON.

shanqs1

Ozzy, thanks for commenting. People can make all sorts of speculations regarding the property market, but think about the current general economic situation: sky high number of unemployment, huge government debts, much tightened bank mortgage lending policy, all these cannot be solved in a foreseeable future. I agree what you say if price is low, people won't sell, therefore would maintain the price, but sometimes it is not the case that you have the power to decide--imagine those who took out a mortgage got on the ladder around 2007, bought at highest price and now in neg equity, those people most likely are on a 2yrs or 3yrs fixed mortgage, when they come out of the fixed period deal, i.e. 2009-10, they are forced to pump in new cash or have to sell to repay the bank due to unemployment (can't afford to payback mortgage). Those bunch of neg equity home owners are yet to face their hardship, only then is the moment when waves of properties would have be forced to the market, whether or not they wish to...that's what those experts are really worried about.

In regarding to your second comment, I do agree I have a nice sum of deposit, but I have been saving it hard for 6 years. I agree in London you can get a one bed flat for £200k, but if I tell you I am not a single lad, but with my wife and a pair of sons? would you agree a requirement of a 3 bed house is a necessity? The scheme allow anyone with a household income less than 60k to apply, I am not even half of the figure, I don't see why I should not be eligible, saving hard for 6 years to get that 45K should not be regarded as a sin.

Keep looking for properties... ...

ozzyozzy

shanqs1 wrote: »

Ozzy, thanks for commenting. People can make all sorts of speculations regarding the property market, but think about the current general economic situation: sky high number of unemployment, huge government debts, much tightened bank mortgage lending policy, all these cannot be solved in a foreseeable future. I agree what you say if price is low, people won't sell, therefore would maintain the price, but sometimes it is not the case that you have the power to decide--imagine those who took out a mortgage got on the ladder around 2007, bought at highest price and now in neg equity, those people most likely are on a 2yrs or 3yrs fixed mortgage, when they come out of the fixed period deal, i.e. 2009-10, they are forced to pump in new cash or have to sell to repay the bank due to unemployment (can't afford to payback mortgage). Those bunch of neg equity home owners are yet to face their hardship, only then is the moment when waves of properties would have be forced to the market, whether or not they wish to...that's what those experts are really worried about.

In regarding to your second comment, I do agree I have a nice sum of deposit, but I have been saving it hard for 6 years. I agree in London you can get a one bed flat for £200k, but if I tell you I am not a single lad, but with my wife and a pair of sons? would you agree a requirement of a 3 bed house is a necessity? The scheme allow anyone with a household income less than 60k to apply, I am not even half of the figure, I don't see why I should not be eligible, saving hard for 6 years to get that 45K should not be regarded as a sin.

Keep looking for properties... ...

Hi there, the trouble is back to my original point how desperate are you for a property? One can look at all these economic figures forever - and still NOT come to any meaningful conclusion ! This is the problem. I cant see prices in London falling another 15%, I could be wrong but this Government is just too interventionist to let anything like that happen - its how they are. They will happily pump billions into the economy to save their political necks....the UK has intervened in the economy more than any other western country - FACT. Anyway we are getting away from the point, if you need to move, move ! If not then play a waiting game - that may or may not work.

As for my comments earlier, you have children, me too. I appreciate you certainly need a 3 bed, but I do know you can certainly find them at just under £250k in London area, if you look hard enough. You have a deposit which you have worked very hard for, like us all, not easy in this country. BUT why still go for this scheme ? You will have to start paying interest on equity part in 5 years, you dont own 100% of property, hassle of buying your share back at some point in the future and of course any gains made on the part you do not own you will in effect 'lose out' financially. As your original equity loan part will go up in value no doubt. For the sake of a home of an extra £35k value - and the extra stamp duty of £5k + is it worth it for you ?

Take care - Ozzy

ladybird3

Just to clarify Ozzy's point, on this scheme you absolutely DO own 100% of the property, it is not a shared ownership scheme and you are not required to pay rent on the part that has been purchased through the equity loan.

You own the property outright however are rquired to pay back the equity loan at the end of the mortgage term or earlier if you wish to.

Tommy_P

Has anyone else had a call from PfP? I am trying to keep track of what date they are up to in regards to getting the loan paperwork out to us. Many thanks everyone and good luck to us all!