Shared Ownership where what how!

Fuzziefondue

Hello

Ok I am going to sound like a complete idiot!

I am hopefully going to be a 1st time buyer!
But I have no idea what to do where to start!

I have seen a property I love and its 50% shared ownership at £109000.

So WHERE do I start!

My parents are going to give me and my OH £10000 towards buying and the OH is due around £20000 after he was knocked off his bike.

Do I need to join a scheme for Shared Ownership? these are not new builds and cannot see any reference to Homebuy etc.

I have asked the estate agent for more details but have yet to hear back on this.

kingstreet

You need to be vetted by the Housing Association which owns the other share. Once you've passed their assessment, get an agreement in principle for a mortgage. Rates aren't great as there are only a few lenders interested in such business and there's little competition.

Fuzziefondue

I have just found out both properties are private agreement and not part of any scheme. But thank you for info.

kingstreet

Private agreement? With whom?

Assuming the vendor isn't planning to staircase so you buy the whole property at completion you are entering into a lease which requires the approval of the HA which owns the other half.

Fuzziefondue

They said it was between the buyer and the owner. I take it this is not good?

kingstreet

Fuzziefondue wrote: »

They said it was between the buyer and the owner. I take it this is not good?

You will be contracting to purchase the current owner's share but you're not buying the Housing Association's share unless the current owner "staircases" upto 100% ownership before completion.

As such, the Housing Association has a right to vet the prospective purchaser as it will be entering into a lease with you for its 50% share on which you will be paying rent to the HA.

Although the EA is technically correct, it is disingenuous to ignore the HA's obvious involvement.

Easiest thing to do is find out which HA owns the other half and ask them their procedure.

GDB2222

Forgetting the shared ownership deal, is the property actually worth £218,000? That's the really, really big question you should be asking yourself. The number of people who have come onto this board moaning about their SO deal and finding they are in serious negative equity ....

kingstreet

GDB2222 wrote: »

Forgetting the shared ownership deal, is the property actually worth £218,000? That's the really, really big question you should be asking yourself. The number of people who have come onto this board moaning about their SO deal and finding they are in serious negative equity ....

... and can't find a buyer because shared ownership isn't everyones' cup of tea.

brit1234

Fuzziefondue you are in a great position with a portential £30k deposit, what you need to do is slow down, take a breather and do your research especially when it comes to shared ownership.

I personally and many other members think it is a complete scam however at the same time there are a few members who like it.

Below is the main shared ownership & shared equity debate thread. Have a read through the whole thing looking for the shared ownership stuff and see the potential pitfalls which people have suffered and those counter arguments where they say it has worked.

https://forums.moneysavingexpert.com/discussion/3177256

Its about 14 pages but in those pages is some good info so go through each page slowly to find the relevant stuff to you.

Personally I would avoid it and buy normally once the compensation comes through. In the mean time if you can add to that deposit and enjoy say 6+ months of price falls maybe you can get a 25% deposit which will get you lower interest payments.

good luck