Ownhome.co.uk : Anyone Tried Them?

siliconbits

I've got a few questions about Co-op + Gov backed Scheme, Ownhome. Is there a comparison between going ownhome and going the traditional route? What are your chances of getting refused if you have a £20K deposit for a 90K loan? Thanks!

Also how do they calculate they calculate their interest? They charge zero interest for the first 5 years and then 1.75 percent for year 6 to 10. Is this cumulative (1.75 percent ^ 5) or additive (5 x 1.75 percent)?

anotherpaul_2

siliconbits wrote: »

I've got a few questions about Co-op + Gov backed Scheme, Ownhome. Is there a comparison between going ownhome and going the traditional route? What are your chances of getting refused if you have a £20K deposit for a 90K loan? Thanks!

Unless you're on a very low income and couldn't get a 70K mortgage (but could get a 50K one, say), I'd be surprised if you qualify. (However, I've no experience of the scheme, so it worth contacting them to ask.)

siliconbits wrote: »

Also how do they calculate they calculate their interest? They charge zero interest for the first 5 years and then 1.75 percent for year 6 to 10. Is this cumulative (1.75 percent ^ 5) or additive (5 x 1.75 percent)?

I don't think I understand your question, but I'll have a go at answering.
Per £1000 that you borrow, the interest is:
Nothing in the first 5 years.
£17.50 per year for each year for the next 5 years (the same in each year).
£37.50 per year after that.
(I suspect it's charged monthly, so divide those by 12 - and multiply by the number of thousands you borrow - to get the monthly figure.)

You pay in interest, so the equity stake stays the same as at the start.

SelenaLouise

Best thing to do is get a number and call up and ask your question.

I believe these schemes are set up for those who cannot manaher to purchase a property on their own and with a £20k deposit I'd say you're in a pretty good position so am unsure if they would take you on. Again best to call up and check.

I've heard for some schemes you are not eligible if you have more than £10000 in savings.

HTH

superfran_uk

Call up and see - they will book you an appointment for about a month or two, and you will be assessed but it takes time so best to get in quickly. They can only say no, and you are not obliged to go through with it of you decide not to.

The interest is paid by monthly direct debit, and it 1.75% or 3.75% of the amount you originally borrowed divided by 12.

Can I ask why you would want to do the scheme if you have enough savings to do it alone? If you go through this route you have less choice about what you buy, for example there is a limit on the number of bedrooms, and you have to take their mortgage which is not the best (5.99% fixed) - you could certainly do better on your own if you could afford to.