First Time Buyers/Keyworkers No Deposit

michael1983l

Wickedkitten wrote: »

Oh right so it's a 10 year loan rather than shared equity. Personally those seem a lot better than shared equity because you know exactly how much you have to pay by the end.

The ownhome scheme is actually a 25 year loan but you can repay 5% chunks any time you like.

Wickedkitten

michael1983l wrote: »

The ownhome scheme is actually a 25 year loan but you can repay 5% chunks any time you like.

What do you have to do everytime that you pay off a chunk? Do you just get a surveyor in to evaluate it or do you have to get solicitors involved and redo the contract?

michael1983l

Wickedkitten wrote: »

What do you have to do everytime that you pay off a chunk? Do you just get a surveyor in to evaluate it or do you have to get solicitors involved and redo the contract?

I cannot tell you for certain without looking at my small print but I believe they have made it as easy as possible. The 5% chunks are paid as the original loan and on your last payment the property is re-evaluated and any difference drawn up. If you pay between 3 to 5 years you can choose to pay back the original loan. Which is what I'm planning to do.

Imp

michael1983l wrote: »

I cannot tell you for certain without looking at my small print but I believe they have made it as easy as possible. The 5% chunks are paid as the original loan and on your last payment the property is re-evaluated and any difference drawn up. If you pay between 3 to 5 years you can choose to pay back the original loan. Which is what I'm planning to do.

From the Ownhome website

When do I have to pay the Ownhome loan back?

You can pay back the Ownhome loan whenever you are able; there is no early redemption or payback charge. The full Ownhome loan will need to be paid back after 25 years (or the term of your mortgage if this is shorter) or if you sell your home. The amount you owe will be calculated on the value of your home at the time of repayment. You will have to pay for an independent valuation and any legal fees associated with the transaction.

Early pay back: You can pay back in instalments of 5% of the value of the Ownhome loan. You will have to pay for an independent valuation, and any legal fees associated with the transaction.

If you sell your home: You can move whenever you choose to. When you move you will have to repay the full Ownhome loan. The amount you owe Places for People will be calculated on the value of your home when you repay the loan. You will have to pay any legal fees associated with the transaction.

After 25 years: The loan will have to be repaid in full after 25 years (or the term of your mortgage if sooner). The amount you have to pay will be calculated on the value of your home at the time of repayment. Depending on the housing market over the coming 25 years, this amount could be less, but could be more than you originally borrowed from Places for People. You will have to pay for an independent valuation, and any legal fees associated with the transaction.

THE GREATER THE INCREASE IN THE VALUE OF YOUR HOME, THE MORE YOU WILL HAVE TO PAY BACK.

neas

So really they are taking a stake in your property... basically investing in your property lol.

So technically they are shareholders in your house... if it rises alot they get alot... if it falls they make a loss.

Cool way of looking at it. I wouldnt be happy.. as the fees associated with paying 5% off are prob not worth it.

Whern they say 5% chunks can you pay off 100% after 5 years or are you limited to 5% per year?

neas

So it allows you to 'forget' about the loan all the while your are 'losing' the potential equity you would've had.

IN all hoensty i think its quite fair tho... you basically pay back the same 'percentage' on your home... if you unfortunate and all home rises by 3x value then so will loan repayment if it falls then you gain.

Wickedkitten

Imp wrote: »

From the Ownhome website


Early pay back: You can pay back in instalments of 5% of the value of the Ownhome loan. You will have to pay for an independent valuation, and any legal fees associated with the transaction.

:eek:

The way that is phrased it makes it sound like you like to pay them back 5% at a time rather than in increments of 5%

michael1983l

neas wrote: »

So really they are taking a stake in your property... basically investing in your property lol.

So technically they are shareholders in your house... if it rises alot they get alot... if it falls they make a loss.

Cool way of looking at it. I wouldnt be happy.. as the fees associated with paying 5% off are prob not worth it.

Whern they say 5% chunks can you pay off 100% after 5 years or are you limited to 5% per year?

Pay in 5% or multiples there of.

Wickedkitten

michael1983l wrote: »

Pay in 5% or multiples there of.

Are you sure about that because everything that I am reading says you either pay them back in 5% installments or you pay them back in full.

michael1983l

Wickedkitten wrote: »

Are you sure about that because everything that I am reading says you either pay them back in 5% installments or you pay them back in full.

That is technically true as you could pay 2 lots of 5% installments then the full ammount.

Lets get one thing straight, that isn't 5% of the loaned value that is 5% of the value of the house. So if you get a 20% loan you will have 4 lots of 5% to pay or any multiple of 5%. You could pay 15% then a final payment of 5%.

I hope that makes sense.