is this a good deal

shellnapier

i dont know where you think i shall ge thte details from.... only info i have is this

http://www.aberdeenshire.gov.uk/councilhousing/options_guide.asp

the whitehills ones - is the ones im reffering to
does that any help

shellnapier

ps mortgage withouht all the insurance is apporx 100 less give or tak a few pence

opinions4u

It still looks to me like a shared ownership scheme with the local authority where you buy 64% and they retain 36%.

Unless there is some extraordinarily generous arrangement between the council and Bank of Scotland (which seems unlikely as the PDF says to get independent advice for the mortgage side of things) I reckon you will need to raise an £8k deposit to get the mortgage.

I really cannot see a bank lending 100% on a shared ownership scheme in the current climate.

For your sake, I genuinely hope I'm wrong.

Cannon_Fodder

Excellent, that helps...link at bottom of that page;

http://www.aberdeenshire.gov.uk/councilhousing/KnockAveGuidanceNotes3bed.pdf

[FONT=Arial,Bold]" The open market price of the 3 bedroom semi detached house is £140,000 and it is being[/FONT]
[FONT=Arial,Bold][FONT=Arial,Bold]offered to qualifying purchasers for a fixed price of [/FONT][FONT=Arial,Bold]£90,000[/FONT], which is a 64.28% discount off[/FONT]
[FONT=Arial,Bold]the market value. As a discount is involved to achieve the sale price of [FONT=Arial,Bold]£90,000[/FONT],[/FONT][FONT=Arial,Bold]
conditions are attached to any subsequent sale of the property:

• In the event that the owner wishes to sell or dispose of the property, they will
need to notify Aberdeenshire Council in writing and Aberdeenshire Council will
have a 3 month period to decide whether or not they want to keep the property

for affordable housing and nominate a suitable qualifying purchaser, at a

reduced price to be agreed.

• Should Aberdeenshire council decide that they no longer want to keep the
property for affordable housing then the owner will be entitled to sell the
property on the open market. The owner will be entitled to receive 64.28% of

the open market value, with the remaining 35.75% of the open market value

going to Aberdeenshire Council.

[FONT=Arial,Bold]Therefore it is recommended that any prospective purchasers discuss the[/FONT]

[FONT=Arial,Bold]implications of the contract into which they are entering with their legal adviser[/FONT]

[FONT=Arial,Bold](solicitor). "[/FONT]

My underlining. You do NOT get to own 100% of the property. They have not even calculated the % discount accurately. Its a £50,000 discount, which from a starting price of £140,000, is a 35.72% discount, and the council want that % back when you sell.

The bold is their highlighting, and they are totally correct that you need expert advice to ensure you are fully aware of the implications before taking on this commitment.


[/FONT]

shellnapier

yes i understand all this the bank when through all this with us, i know that happens, and thats y the bank said you dont need a deposit... so i think its a good deal

shellnapier

opinions4u wrote: »

It still looks to me like a shared ownership scheme with the local authority where you buy 64% and they retain 36%.

Unless there is some extraordinarily generous arrangement between the council and Bank of Scotland (which seems unlikely as the PDF says to get independent advice for the mortgage side of things) I reckon you will need to raise an £8k deposit to get the mortgage.

I really cannot see a bank lending 100% on a shared ownership scheme in the current climate.

For your sake, I genuinely hope I'm wrong.

if you are right, whats gona happen, if i got back to the bank to to take it up and there gona say sorry i made a mistake..

ps after what has been said on here i have contactd the bank lady agian and she has asuusred we donot need a depsoit - so ???

Forever_Red

Shellnapier, from reading these posts, I feel that whatever opinions people offer you, you will still believe that this is a good deal for you and your family. If that is your thinking, then good luck with the house buying, BUT as a few posters have stated, Please seek independant legal advice first as it may save you money in the long run. If it turns out that you are correct, then I am sure all the posters on here will wish you all the best for your house move.

Remember, the posters are only trying to help and not talk you out of it.

Good luck with your decision.

Alan

opinions4u

shellnapier wrote: »

if you are right, whats gona happen, if i got back to the bank to to take it up and there gona say sorry i made a mistake..

ps after what has been said on here i have contactd the bank lady agian and she has asuusred we donot need a depsoit - so ???

Ask them to put it in writing before you hand over £hundreds for surveys and solicitors.

shellnapier

ok thank i will go see soilcitor before i do anything but i think i have don enough at the moment... untll i know if i have a chance at hte house, i do approicate all your advice

luckyfool

opinions4u wrote: »

It still looks to me like a shared ownership scheme with the local authority where you buy 64% and they retain 36%.

Unless there is some extraordinarily generous arrangement between the council and Bank of Scotland (which seems unlikely as the PDF says to get independent advice for the mortgage side of things) I reckon you will need to raise an £8k deposit to get the mortgage.

I really cannot see a bank lending 100% on a shared ownership scheme in the current climate.

For your sake, I genuinely hope I'm wrong.

Not sure why you think it is particularly unusual for banks to use the local authority equity as a deposit? While some lenders/most would require a minimum 5% coming from the applicant so they have some "skin in the game", it is also common for lenders to use the government equity as a deposit, and give access to low ltv deals based on that. Halifax/Bank of Scotland do this, as there is a mortgagee protection clause meaning they get their cash back from any sale before the other parties. i.e. in this scenario it would need to seel for more than 35% less than the original value for Bank of Scotland to lose any of their capital. I do believe Halifax at least still credit score the cases as if they are 100% (so BofS may do the same thing), based on the lack of a true deposit and the resulting higher risk of arrears, so this all may be a moot point.

If you are seriously considering doing it then it might be worth getting it approved in principle, I believe BofS do a soft footprint so this should not effect your credit score one way or the other. As the lenders are applying very tough scores at the moment there is not any guarantee that you would pass.

Luckyfool