Ownhome scheme

MigsyBigsy

Hello,

just wondering whether anyone has been succesful in the Ownhome Scheme. I phoned a couple of months ago and have not had a call since...

thanks

Cat695

why do you want to get involved in a scheme that makes you pay over the odds for a house?

paulfaz

I don't get this:

The Ownhome loan could enable you to own a home worth up to 40% more than you could afford with just a conventional mortgage. For example, you could buy a home worth £200,000 with a mortgage for only £120,000. In effect the Ownhome loan from Places for People tops up the amount you can borrow on The Co-operative Bank mortgage.

If you read this it is making it quite clear you can't afford the house

You are tied in with one mortgage provider - possibly for life

You have no idea how much you will have to pay back in the future - it's re-badged shared ownership

And it's government led!!!!!!!!!!!!!

Why are you looking at this option indeed?

MigsyBigsy

cheers for the replies.

I guess its not such a great idea...

londongirl

MigsyBigsy - yes i'm currently typing this from my little flat that i bought with OwnHome 4 months ago and very happy. Search on my name if you want to see other threads about OwnHome or PM me if you want any other info.

Cat695 - Why are you answering something on a thread that you obviously know nothing about? How does OwnHome make you pay over the odds for a house? You can buy anything on the open market through OwnHome - so you are paying exactly what anyone else would pay who came along wanting to buy that same property. The flat i bought went for exactly the same price as one in the next block (which sold two weeks after i bought this one) and i had viewed both and the one i bought was in immaculate condition with new kitchen and new bathroom etc. The other one that sold for the same price had a grim kitchen that was the original one from the 80's when the flat was built plus it had a car parking space that is in a car park two blocks away from the flat whereas mine has its own individual space a few metres away from my flat. So not exactly sure how buying through OwnHome has made me pay over the odds? I assume you are actually thinking of other schemes where you have to buy a new build property - in which case you should get your facts straight before answering a post that you obviously don't know anything about.

Paulfaz - you are not tied into mortgage provider for life just for the inital how ever many years you choose to tie in with and then you are free to look elsewhere. You are of course slightly more restricted as not everyone will lend when there is a 2nd charge on the property. However i know that Halifax will and a cuople of others so after a couple of years people do actually have a choice to move.
As a bonus though the proportion of money that OwnHome lend you acts as your deposit. With the Coop at the moment you can get a much better interest rate if you have a 40% deposit and the lowest they will lend to you with is if you have a 25% deposit. Tell me how many first time buyers have enough spare cash for a 40% deposit on a home especially in the london area?

I'm currently pretty happy in my OwnHome scheme bought flat - on a tracker rate that is currently 1.49%. I now pay £258 a month rather than the £600 plus i would have needed to be able to rent somewhere similar in similar location. Oh and out of that £258 since only £93 is interest i'm paying off £160 odd each month off the mortgage plus saving £200 a month ready to make an overpayment lump sum later in the year after it has fed nicely into my 6% regular savings account for a few months.

theartfullodger

Londongirl asks " Why are you answering something on a thread that you obviously know nothing about "

- steady on, please... There'd be very many fewer posts here if everyone took note of that restriction!

And, londongirl, you don't know that the poster knows nothing about the matter.. Don't we have forum guidelines on being polite (which I must keep remembering!)

Cheers & Best wishes to all my readers, those who agree with AND those who don't.

Artful..

Wickedkitten

londongirl wrote: »

Cat695 - Why are you answering something on a thread that you obviously know nothing about? How does OwnHome make you pay over the odds for a house? You can buy anything on the open market through OwnHome - so you are paying exactly what anyone else would pay who came along wanting to buy that same property. The flat i bought went for exactly the same price as one in the next block (which sold two weeks after i bought this one) and i had viewed both and the one i bought was in immaculate condition with new kitchen and new bathroom etc.

OK, say both flats sell for 200k, you buy one with a 50% deposit in the form of an equity loan, and someone else buys one with a 50% deposit.

You both have a mortgage for 100k, but you still have to repay the other 100k, they don't because they have a deposit that isn't a loan. Once they have paid off the 100k, that is it for them.

That's not even getting into the fact that if the prices correct massively you will end up paying a hell of a lot more than the 100k that you have.

Cat695

londongirl wrote: »

MigsyBigsy - yes i'm currently typing this from my little flat that i bought with OwnHome 4 months ago and very happy. Search on my name if you want to see other threads about OwnHome or PM me if you want any other info.

Cat695 - Why are you answering something on a thread that you obviously know nothing about? How does OwnHome make you pay over the odds for a house? You can buy anything on the open market through OwnHome - so you are paying exactly what anyone else would pay who came along wanting to buy that same property. The flat i bought went for exactly the same price as one in the next block (which sold two weeks after i bought this one) and i had viewed both and the one i bought was in immaculate condition with new kitchen and new bathroom etc. The other one that sold for the same price had a grim kitchen that was the original one from the 80's when the flat was built plus it had a car parking space that is in a car park two blocks away from the flat whereas mine has its own individual space a few metres away from my flat. So not exactly sure how buying through OwnHome has made me pay over the odds? I assume you are actually thinking of other schemes where you have to buy a new build property - in which case you should get your facts straight before answering a post that you obviously don't know anything about.

Paulfaz - you are not tied into mortgage provider for life just for the inital how ever many years you choose to tie in with and then you are free to look elsewhere. You are of course slightly more restricted as not everyone will lend when there is a 2nd charge on the property. However i know that Halifax will and a cuople of others so after a couple of years people do actually have a choice to move.
As a bonus though the proportion of money that OwnHome lend you acts as your deposit. With the Coop at the moment you can get a much better interest rate if you have a 40% deposit and the lowest they will lend to you with is if you have a 25% deposit. Tell me how many first time buyers have enough spare cash for a 40% deposit on a home especially in the london area?

I'm currently pretty happy in my OwnHome scheme bought flat - on a tracker rate that is currently 1.49%. I now pay £258 a month rather than the £600 plus i would have needed to be able to rent somewhere similar in similar location. Oh and out of that £258 since only £93 is interest i'm paying off £160 odd each month off the mortgage plus saving £200 a month ready to make an overpayment lump sum later in the year after it has fed nicely into my 6% regular savings account for a few months.

Londongirl do your maths before ranting off because it makes you look rather silly

londongirl

Ok so which bit of my maths do i have wrong?
If i have fair enough as maths isn't my strong point but i've looked at what i've written and not sure which bit you think is wrong?

And sorry if i bit anyones head off its just the first reply to anyone asking about these schemes is don't do it - without , in my opinion, a lot of the people who say this knowing the difference between the various schemes or exactly how they work. So by simply telling someone they would be paying over the odds for a house - its just not true, so it just puts my back up a bit. There are always a lot of assumptions being made about people who want to use these schemes - i.e the assumption that by renting they can save up enough deposit to eventaully buy a house out right when the bottom of the market comes. Well 1) no one acutally knows when that will be and 2) if i was personally paying rent of £600 a month i wouldn't be able to save up anything near enough for a depost of the 20% plus you need.

Cat695

londongirl wrote: »

Ok so which bit of my maths do i have wrong?
If i have fair enough as maths isn't my strong point but i've looked at what i've written and not sure which bit you think is wrong?

quote]


Ok london girl

what exactly did you pay for your place

all the figures please

2 flats same place both on for 100k......I have 25k deposit.......You buy on own home........I will get that flat cheaper than you.....FACT

londongirl

Wickedkitten - or the way i look at it is - that is great for someone who happens to have 100k lying about but then they are pretty sorted in this world anyway.

So the question is how did they get that 100k - and are you suggesting that 100k is in the reach of the other person who needs the ownhome loan?

If you buy a flat for 200k and you get mortgage for 50% and equity loan for 50% (which incidentally you can't do with ownhome as max is 40%), if the price of the house goes up then whever you want to buy the rest of the house, or when you have to buy it after 25 years then yes you are going to owe more money than you would have done had you bought it outright in the beginning - but you werne't in a position to do that in the beginning. If the house price has fallen then the house is revalued and you actually do better than the person who bought theirs outright becuase you only have to pay back the value of what 50% is now worth.
For the first 3 years of owning the house you pay back exactly what you borrowed if you want to buy the whole thing - regardless of if house prices go up or down.

Also what do you mean by "That's not even getting into the fact that if the prices correct massively you will end up paying a hell of a lot more than the 100k that you have"?
If they correct massively and you have bought at the same time as someone who bought the whole thing outright you are in a better position as you only have 50% of the fall not 100% and you are then in a position to buy the other 50% at less than you would have when you first bought the house.

It won't work for everyone - and if someone is buying something well out of their reach then it won't work.