Shared Ownership & FTB (request for urgent advise please)

rikleo2001

Hi

I been offered a 2 bed flat (New build)
Market price: 206000
My Share 40% : 84200

Now I have to arrange solicitor & Bank to go through all processing or possibly mortage broker who does it all without a FEE!
I got time to accept their offer in 10 days and to arrange solicitors and mortgage.

Here are my questions and requesting for your views and recomm..

1. Should I pay Full Stamp duty?
2. Mortage advisor on the site arranged by housing association assessed me and qualified me for the finance and he asked me that I need only 10% deposit to get £84200 on 3 year fixed @ 7.8 %, this seems high? and also they will charge me fee of 2% on the purchase price.

3. I contact my bank halifax and they told me on new builds they must need 20% deposit, so how come the mortage advisor will get me the same on 10%?
4. Are there any best Mortage advisors on shared ownership which offers free service because they get commission from lender?
5. Are there best solicitors who deals in shared ownership purchase and on low fee?
5. any other advise please?

Many thanks

Rik

Son_of_a_beesting

WOW 10% deposit and you only get 7.8% seems very high. Not sure if you pay the 2% on the purchase price either, that seems strange.

herbiesjp

You should be abel to find advisers who will either work for a lower fee, or who will be happy to take the commission from the lender.

Based on the low mortgage amount, I'd guess some fee will need to be paid to an adviser, but not 2% of the purchase price.

Rate does seem high.

I'd get a second opinion from another whole of market adviser, not just the one tied into the Housing Association

haras_nosirrah

I am a mortgage advisor who specialises in shared ownership and does assessments for a housing association (and before anyone screams at me am just saying that to say that I know what i am talking about)

With a 10% deposit the lender will be leeds - 7.89%. The advisor is right and this is the only lender

Have you asked if you can reduce your share slightly (most HA's want to achieve a blanket % so if someone buys slightly more then others can buy slightly less) or if you can have help from family to get to the magic 15% deposit as then you can access Woolwich who have a rate of 6.39% (although fees are higher and paid upfront)

I am surprised that the advisor charges as one of the things that qualified me for my place with the housing association is that I don't charge. 2% is ridiculous - either find someone else or use the 2% that you save by not paying him to go towards the deposit for the woolwich. My advice would be to get to 15% deposit if at alll possible

plum24

Hi there, sorry to gatecrash, but wondered if i could pick your brains... OH and i are currently looking into the shared ownership route, we have seen a property offering a 30% share for £32500, (this is with SWAN housing association). We are so eager to get the ball rolling but i honestly do not know where to begin, should we look for a mortgage before approaching SWAN or should we go through SWAN for all of this, how do you get the ball rolling? Also on £32500, aside from the fees that SWAN have mentioned, what sort of deposit will we need for a mortgage on this amount.

Many thanks, again sorry for gatecrashing.

Plum

brit1234

plum24 wrote: »

Hi there, sorry to gatecrash, but wondered if i could pick your brains... OH and i are currently looking into the shared ownership route, we have seen a property offering a 30% share for £32500, (this is with SWAN housing association). We are so eager to get the ball rolling but i honestly do not know where to begin, should we look for a mortgage before approaching SWAN or should we go through SWAN for all of this, how do you get the ball rolling? Also on £32500, aside from the fees that SWAN have mentioned, what sort of deposit will we need for a mortgage on this amount.

Many thanks, again sorry for gatecrashing.

Plum

Check outthe other shared equity threads with the dangers, it could trap you in a property which will loose value fast and find it near impossible to move up the ladder.

robin_banks

I'm with brit on this one I'm afraid.

Tread very very carefully with shared ownership. Most comments on thie site are negative.

getmore4less

The problem with shared equity is you are in a trap ifthat is all you can afford.

You need a plan to get out.

Selling will be difficult.
So you have to have the ability to let the place in case you have to move for work.

You have to have a plan to own 100%.

This gets harder if prices drop or if they go up.

To get more equity you need to save so you must have a clear idea where the new money will be coming from(like pay rises)

If you don't have this clear vision where new money is coming from then you can't afford to buy.

In a stagnent/dropping market shared equity is ideal for those that can afford more and the rent on the unowned bit is cheaper than paying interest on a loan.

plum24

Hi thanks for the replies. I have looked about on here and i know what you mean about negative views
I thought the shared equity schemes were finished and having looked for such properties in havering has proved fruitless. I can see what you mean about them being hard to sell, this particular property has been on the market for a while. Hmmm i just dont know what to do, see i wont be accepted for a mortgage due to a default i have (Jan 09) and OH wouldnt be lent enough for us to buy anything local to work and family etc... house prices here seem to be going up, have been looking around for a good few months. And the cheapest we've seen is still going to require approx £10000/£12000 deposit - we have no where near enough as yet.
Excuse my rant, and thanks again for your replies gues we shall keep saving and looking.
Plum.

SR_Swansharedowner

Take my advice and avoid Swan, it all starts out okay and then once they have sold all the flats the management of the block and condition of the common areas goes to the dogs, service charges are a joke. Worst decision of my life and I am desperate to get out of this. I cannot sell the place.

See for yourself, just google "Swan Housing" or "Shared Ownership Nightmare"

plum24

Hi SR, you sound as though you are in a real dilema, a few months back we looked into mychoice homebuy but the funds ran out before we really got anywhere, so thought this was the next best thing for us... how wrong i am, seems many are in your position!!
In all honsety, i have left a few messages with SWAN, as, until i asked about on here we were deadset on going this route... they are terrible at getting back to you, even at this point they are already dragging their heels... and we are only interested in a property... seems their answer phone is always on!!! So can only imagine how difficult communication becomes once they have your money.
Thank you so much for your honesty, really hope your nightmare is over as soon as possible.
Take Care Plum.