Shared Ownership - Need some help experts!. :-/

[Deleted User]

Hi All

Need some urgent advise.

Got a shared ownership property in 2008. Purchased 25% of full value (173000) so put down about 6K deposit.
Since then our rent has increased and now it is at £360.00 PCM and the mortgage is £225.00.

Well I visited the bank last week to discuss my fixed rate mortgage which is due to end soon, anyway they said to me that they will be able to
offer me 130K, so upon hearing this we though lets purchase some more of our property. After speaking to the bank further we mentioned that we
saw a house that was very nice for 130K, they said that it would be better to buy this instead as often shared ownership property is over priced, for
example the housing association charge 10K over the odds per tranche. Now the bank tell us on their system our house is worth 20K less on the system,
now I know this is not market value but I am concerned that I was ripped off by the housing association, and will be again if we buy further.

So all set on this new house (a wreck to be honest) but has so much potential, the house is 120K and had 5k cash back, because it will need new
ch and bathroom, kitchen, and full decoration. Now we have the mortgage offer they want 12k deposit (10% of course), now if our house sells at what we purchased
it for we have our 6K back and we need to get a further 6k which I do not have, we have only just received from paying off some debts so have had no chance to save.

Now I am concerned that the market is at the best place to buy and I need to act quickly? but do I

1. Take this new house, find 6K via a personal loan and then look for fees on top
2. Buy some more of this house
3. Do nothing for the moment

I feel stuck and I do feel a victim of shared ownership, I was 18 when I purchased and feel it was the worst mistake ever!.

Thanks for your help.

kiddy_guy

Why is the house worth 6k less?

Because the bank says it is?:eek:

Would you ask your bank to value your car? :rotfl:

Surely the house is worth whatever someone is prepared to pay for 25%?

However if the overall value has dropped by an amount, it may well be market value, or the fact the market has moved.

Unfortunately, whilst not what you wanted to hear, if you have lost money on the property, then this is merely representative of the marketplace in some areas. You may well be able to afford that 130k house now that might have been 145k 3 years ago.

[Deleted User]

Yeh thats true!, thanks for your response, nobody else is responding ? :-/

poppy10_2

assj wrote: »

Now I am concerned that the market is at the best place to buy and I need to act quickly?

That kind of thinking is very dangerous, you are talking about spending hundreds of thousands of pounds, it's not something you should be rushing in to. Sounds like you overpaid for your SO property in the first place, yet another victim of this scam. The last thing you should be doing is taking out a loan to buy a property - the banks wouldn't accept this anyway. Just knuckle down and save hard until you have enough for a 10% deposit.

brit1234

Good luck, lots of us here constantly warn the dangers of shared ownership. It is a scam designed to inflate house prices.

What ever you do, don't get a loan as a deposit you will make your position worse.

House prices are falling, however your only exposed to 25% of this (a rare blessing with S/O). Rather than put more money into it, place it into an ISA or high interest account and start saving that deposit. Houses will be a lot cheaper in two years time.

CloudCuckooLand

https://forums.moneysavingexpert.com/discussion/3004348

assj wrote: »

I took a shared ownership mortgage and purchased this share in this house when I was 18, so I did rush into it a bit and now I am lost as this is again all new.

Don't rush again, then...

You may not be able to sell if you have neighbour disputes lodged against you, or by you against others...

Rather than spend money you don't have on the fees and costs of selling, get saving, clear your debts - don't buy any more of the house for now - then when you have a more mature ability with money, ask again.

birkee

brit1234 wrote: »

Good luck, lots of us here constantly warn the dangers of shared ownership. It is a scam designed to inflate house prices.

What ever you do, don't get a loan as a deposit you will make your position worse.

House prices are falling, however your only exposed to 25% of this (a rare blessing with S/O). Rather than put more money into it, place it into an ISA or high interest account and start saving that deposit. Houses will be a lot cheaper in two years time.

Fully supported by people desperate to get their hands on property under ANY terms and conditions.

Don't like the idea of shared ownership myself, but I don't think you can call people that support it by using it, victims of a scam. More like part of the scam for supporting it. i.e. the OP.

Richard_Webster

With most shared ownership schemes through Housing Associations etc you have to offer your 25% share first to people on the HA's list and the HA will only allow you to sell to anyone at the price they fix.

What the bank thinks has nothing to do with anything in valuing the property. Have you approached your HA about selling?

brit1234

Richard_Webster wrote: »

With most shared ownership schemes through Housing Associations etc you have to offer your 25% share first to people on the HA's list and the HA will only allow you to sell to anyone at the price they fix.

Will people want to buy then when normal properties are falling? Shared ownership is hard enough to sell anyway, let alone if HAs aren't reducing when others are.

Richard_Webster wrote: »

What the bank thinks has nothing to do with anything in valuing the property. Have you approached your HA about selling?

But it does have an effect on buyers getting a mortgage.

Shared Ownership is a scam.

Orpheo

Richard_Webster wrote: »

What the bank thinks has nothing to do with anything in valuing the property.

But they do decide whether or not to lend the money and how much to lend if they do, all based on a surveyors valuation done on the bank's behalf.

Shared ownership is a scam.

Richard_Webster

Quote:
Originally Posted by Richard Webster
What the bank thinks has nothing to do with anything in valuing the property.
But they do decide whether or not to lend the money and how much to lend if they do, all based on a surveyors valuation done on the bank's behalf.

Shared ownership is a scam.

I wasn't quite saying that, but nearly!

The fact that the HA has one valuation and a mortgage lender another makes it that much more difficult for a person with a percentage share to sell it and some HA's solicitors charge and arm and three legs for providing confirmations that the rules have been comped with (which the HA itself could do).