Shared Ownership & Keyworkers

GhostDog_2

I'm hoping someone can offer some advice.....

We have been offered 50% shared ownership of a 3 bedroom house in the area which my partner works as a keyworker. £70k share & rent on remaining 50%

He has a poor credit history and we were previously turned down for a 100% mortgage by Nationwide when we were trying to work out if we could afford to buy on open market.

I earn £26k pa (as a keyworker in a different geographical area) and plan to apply for the mortgage for this property in my name only. Would I need to declare on the full morgage application that we live together? I've only made an application for agreement in principle so far....I'll need 100% mortgage for 70k & will be paying rent of £175 per month.

And would the housing associatio0n insist that his name be included on the mortgage application or would they not really care so long as they are paid?!!! I ask this because we were accepted on to this HA register due to his work location.

So many questions.....I'm trying to keep it brief!
Thanks in anticipation!

molerat

Would they allow YOU to buy the property because you are not a keyworker in the area where the property actually is ... doesn't that defeat the object of the scheme ?

lynzpower

Check it out witt the housing association. I would say its pretty unlikely to preclude you at all. If you are a couple, will be living as a couple, and you are BOTH keyworkers albreit in different LAs, I should not imagine this would pose a problem.

You could say, youve chatted with your broker, and it will savbe you quite a bit of money if the mortage is in your name only ( not strictly a lie) and is there a problem with it, I expect they will say no.

GhostDog_2

Thanks to both of you....
Molerat - maybe I should have added that the med term plan is for me to move my post and continue working as a keyworker in this geographical area. Obviously this will also assist our budgeting as I'll have less distance to travel.
My partner will obviously be contributing to the cost of buying the property (as he helps pay rent now).....

MortgageMamma

Hi,

I just thought I'd add in here, whilst it is the housing associations decision if they will allow the property to be mortgaged in just your name (i think it is unlikely they will agree to this by the way), it would be wise for you to consult a whole of market mortgage broker with experience with key worker mortgages. You can still actually get a 100% mortgage on a shared ownership property if your credit rating is poor. Obviously the companies that do this work on a scale of rates/terms, which depend very much on the level of adverse credit. For example someone who has previously been bancrupt could pay something around 7.99%, but someone who has only had missed payments/CCJ's could get a mortgage of around 6.50%. These are not exact rates only examples.

I an not saying this is the right thing for you to do, I am telling you this so that if the HA wont agree to your request you don't think there is no scope for you to obtain the property.

HTH

MM

izoomzoom

Hi

I know that your question is more to do with whether the HA will accept only you purchasing, so you really need to understand the criteria by which they choose.

It may be that you have to be a KW in that particular LA or just a KW or at least one of you has to work in that area. They may also consider how long you have been on waiting list, how big your family is, are you currently living in overcrowding. There is so much, you really need to phone them and understand.

However, I really just wanted to mention that we are getting a 100% mortgage at a rate of 5.75% although our credit rating is very good (as far as I am aware). We are getting this through Ipswich BS.

GhostDog_2

Well we viewed the property (from outside) again today and were disappointed. The garden (a really important element for us) was not as big as we'd remembered and we're unsure now if this is really the best property for us.

I think an alternative option may be the Open Market Homebuy Scheme.

I contacted a mortgage advisor online a few weeks ago and he advised me that the 25% equity loan was actually classed as a deposit - therefore any mortgage we took would only be considered as 75% (Nationwide wouldn't consider more than 95% and we have no real savings to put into a deposit)

The next bit for me to work on is finding out if we have any hope of being one of the 35 out of 1000 applicants chosen to benefit from this equity loan scheme.....I'm hoping the fact that we were offered a property may mean we're somewhere near the top of their priority list.

Emotional roller coasting isn't it?

MortgageMamma

Could you not just reapproach the HA and say you were hoping for something with a larger garden? they may well present you with alternative properties

MM