part ownershiip and 1st time buyer - advice please

nicocathvog

Can someone give me advice please. My son is a first time buyer, he is interested in a 25% shared ownership from a housing association. What should he look out for? and any advice please.

suki1964

Really look into what the costs and terms are for either staircasing up or for selling the share. It seems each scheme works differently - where as I was reimbursed for the improvements at time of sale another shared owner on this board wasnt and lost a lot of money. Personally I would try for a bigger share if possible as staircasing costs a lot of money everytime you go through it and if you decide to sell your 25% share, you only get 25% of the equity which may not go far enough as a deposit on another property

indiegirl_2

I think it might be very difficult for your son to find a mortgage lender who will lend on 25% - I've seen S/O properties for 30% and 40% but never that low. The lower the share you buy, the less number of places are willing to lend. If he can afford to buy more, I would strongly suggest that he does so...

lynzpower

25% starts are the norm in some parts of London.

makingendsmeet_2

We are just in the process of buying 25% of a shared ownership scheme ,we went through a whole of market broker whom are highly reccomended on this site London & Country and they got us a mortgage with no problems and we needed 100%

welnik

indiegirl wrote:

I think it might be very difficult for your son to find a mortgage lender who will lend on 25% - I've seen S/O properties for 30% and 40% but never that low. The lower the share you buy, the less number of places are willing to lend. If he can afford to buy more, I would strongly suggest that he does so...

I work for a mortgage lender. We would not be bothered in the slightest if you borrowed 10% of the property. The reason being, very little risk. The lender has first charge, which basically means, first dibs on any sale proceeds should your house be repossessed. The housing association get second dibs and you are third in line!

i purchased a shared ownership property 17 years ago and would recommend it to anyone. I purchased 75% of mine, but all my other neighbours purchased 25% (my next door neighbour worked for the sols who did the whole estate, very naughty, but there you go!). The rent I pay for the 25% I dont own is less than £25.00 a month and this includes my buildings insurance! I actually borrowed 100% of the share so didnt have to find a deposit.

Get your name down on all the housing association lists, you never know, it could work out nicely for you!

pda

My mate was asking about shared ownership, whether or not she would be eligible for it. She is a Danish citizen but has lived here for 5-6 years, I had a look on the website but couldn't see any. Anyone know if she would be eligible?

cheers

lynzpower

If shes danish I dont think theres a problem, one of my italian colleagues is looking into it at the moment - EU, same rights apply I wouldve thought.

lonelyinlondon

I bought a shared ownership flat 18 months ago. I was lucky and managed to get into the first few flats they sold on a special deal where I do not have to pay rent on the part I do not own. I would recommend it but be careful, my experience was that not all lenders will lend to Shared ownership people and the number of possible lenders are cut down even further if you need 100 per cent mortgage.