My Choice Homebuy

Chris2685

HAZIEC wrote: »

Thanks, I have read threads on here about people who have been let down with the funding running out at the last minute which is not acceptable. They were posted last year, so they will ask about that at the interview.
If you can point me in the direction of the threads of people who have bought with this scheme and had problems I would be most grateful.

Here is a useful post by a wise young man who decided that renting was a much safer option than these schemes afterall.

http://forums.moneysavingexpert.com/showpost.html?p=14347319&postcount=4

haziec

Chris2685 wrote: »

Here is a useful post by a wise young man who decided that renting was a much safer option than these schemes afterall.

http://forums.moneysavingexpert.com/showpost.html?p=14347319&postcount=4

Sorry but this is nothing to do with the scheme that I asked about, the post is just your own personal view.

Please don't take offence but we would really like to hear from someone who has bought under this scheme, successfully or otherwise.

The housing market is different by the location in which you live, how much in demand properties are there and also how much rents are and what for? Rents in our area are about £800 pm for a one bed flat.

Chris2685

Where do you live?

We pay £850 a month for a 2 bed and I commute into London daily in about 30-45 minutes..

As for someone who has successfully bought under the scheme, I can't remember anyone who posted here who has actually successfully bought a property...

Wickedkitten

HAZIEC wrote: »

Hi Miss B, thats not what they were told, they said that IF they want to make a repayment, then its recalculated first by an independent valuation, then whatever you are paying off is a % IYSWIM?

Did they tell them that when they have it valuated for repayment, it has to be a full survey each time and also you can only pay it back by a minimum of 10% each time?

Also did they tell you that you have to maximise your mortgage and this like the Ownhome scam is essentially a top up equity loan?

Did they tell you you can only get a mortgage that spans 25 years?

Did they tell you that you have to ask for their consent to carry out any improvements and you can only do essential ones?

They charge you on the amount they lend eg if 50% is 90k then its calculated on that over the year and divided by 12, how would they be able to change it month to month following the rise and fall of the house market? this would mean an independent valuation once a month which would not be economically viable.

They don't have to do that at all as the 1.75% just increases by RPI + 1% each year. Make sure you ask them about that so they don't gloss it over.

When you sell, again, the calculation is made, IF the value of the property has increased you owe them a larger share but same if decreased then their amount is smaller.

Did they tell you that if you are in negative equity, you have to ask them first if you want to remortgage?

If your daughter is planning on staying there for a long time, prices could well shoot up so what's going to happen if 10 years from now they decide to get a bigger place and can't because of the equity loan tied around their necks?

haziec

Quote:
Originally Posted by HAZIEC
Hi Miss B, thats not what they were told, they said that IF they want to make a repayment, then its recalculated first by an independent valuation, then whatever you are paying off is a % IYSWIM?

Did they tell them that when they have it valuated for repayment, it has to be a full survey each time and also you can only pay it back by a minimum of 10% each time?yes

Also did they tell you that you have to maximise your mortgage and this like the Ownhome scam is essentially a top up equity loan? yes

Did they tell you you can only get a mortgage that spans 25 years? no

Did they tell you that you have to ask for their consent to carry out any improvements and you can only do essential ones? no



Quote:
They charge you on the amount they lend eg if 50% is 90k then its calculated on that over the year and divided by 12, how would they be able to change it month to month following the rise and fall of the house market? this would mean an independent valuation once a month which would not be economically viable.
They don't have to do that at all as the 1.75% just increases by RPI + 1% each year. Make sure you ask them about that so they don't gloss it over.
ok tks


Quote:
When you sell, again, the calculation is made, IF the value of the property has increased you owe them a larger share but same if decreased then their amount is smaller.
Did they tell you that if you are in negative equity, you have to ask them first if you want to remortgage? yes

If your daughter is planning on staying there for a long time, prices could well shoot up so what's going to happen if 10 years from now they decide to get a bigger place and can't because of the equity loan tied around their necks?

Good comments, thanks, they have not had their interview yet and we are going with them and will ask a lot of questions, and yours have been added to their list!

I will unsubscribe now as I think I have enough information and opinion.

thanks everyone!

Wickedkitten

Make sure that all of the questions that they need to have answered get answered now, and they know exactly what they are signing themselves up for so they can't come back to you and your husband angry years down the line saying that you talked them into getting in over their heads because they aren't financially savvy and you two should have known better.

Even if you have to sit down and come up with a spreadsheet and flow charts and spend the entire night explaining things in detail, make sure they know what they are doing so they don't have any cause to get upset with you if they end up signing up for it and everything goes pearshaped.

Northants_Simon

Chris2685 wrote: »

You can only have 1 more than you need.

So if you are a couple you can only have 2 bedrooms or less. If you have a child you can go for 3. I'm not sure how many children you need to qualify for a 4 bed.

I don't really see why it matters to them anyway!

We have three children and got a 4 bedroom house but with only 15% loan from Homebuy. The rest financed with our deposit and a mortgage.

Northants_Simon

mell242 wrote: »

I am very interested in this scheme as me and my partner can not afford to buy outright in the village that we currently live.
Just wondering if anyone has an idea of what the main criteria for selection for this scheme is? Is it primarily keyworkers that are successful? Also, does having children/overcrowding increase your odds of being offered a place? There seems to be such little information about it.

If you have been succesful what is your working/housing 'background' if you don't mind me asking?
Thanks

Having children seems to get you higher up the list. We aren't key workers and earn a reasonable amount. We had been renting for 10 years a 3 bed house (with 2 adults and 3 children) and even with our deposit couldn't afford the sort of house we wanted.

The information pack we received was full of photographs of single people and young couples. The captions said "nurse so and so in her new home" "XXX is a Policeman and is photographed in his new home", which made us think we didn't stand much chance. I think having kids is what swung it our way. We moved in last October.

Northants_Simon

MissB wrote: »

I was seriously considering this until something in my last call to them rang huge alarm bells:

The 50% share that you dont own is recalculated to 'keep in line with the current housing market'. This means that it fluctuates uncontrollably.

If we start to have another housing boom, or they just decide that the area's house prices are improving, then this share will go up unpredictably and could cause serious problems.

I can't cope with any variance in my outgoings as my money is too tight, so it's a definite no to me. I prefer to rent where my rent is fixed and if I had a mortgage I would have a fixed rate one so I knew exactly what was going on every month - for a fixed time at least.

If I fixed the mortgage on my share there is no guarantee the rented share wouldnt spiral out of my reach - and quickly.

That scared me.
It may be something they should consider carefully.

B
x x x

Sorry, that isn't true at all. At the start you have the house valued in the survey. They then lend you whatever percentage, say 20%, £40,000. You then pay interest on £40,000 at 1.75%. Each year they review this inline with a price index, so you will pay slightly more each year.

The only time they value the house is when you want to sell or pay off the loan. They then value the house and you still owe 20% of the value, not the original amount you borrowed. So if prices go up you owe more, if they go down you owe less. In effect they share your equity. You can also pay back some of the loan in the same way, I think it's in mulitples of 10% from what I remember.

The least amount they will lend is 15% and the most is 50%. Beware that they do expect you to take out the most you can on a mortgage. This nearly tripped me up as I had to offer slightly more for my house than I wanted to simply because of how much I could borrow on my mortgage. So if you can borrow £200,000 they will expect you to borrow £200,000 and no less, they then top this up with their part.

Northants_Simon

BTW, to anyone thinking of using this scheme it is a lot of hassle and we had tears on the way. Just because you are accepted that does not mean you have the money. We really didn't know 100 percent we had the money until our solicitor called to say he had it in the bank (on moving day). We had a lot of hassle and at times thought about pulling out. Our solicitor had a lot of hassle as well.