Shared Equity - Charles Church

buenfoxa

I’m after a bit of help understanding which providers would potentially borrow on a 85/15% builders shared equity scheme such as the one which Charles Church is currently offering. As I understand it, it is not the HomeBuy scheme run by the Government but one the builder runs privately and takes a first charge on the title.

Facts and figures if required:

House ‘list’ price: £195,000
Builders Shared equity ‘loan’: £29,250
Our contribution @ 5%: £9,750
Mortgage @ 80%: £156,000

Joint Salary of £55k with £250 x 2 car loans.

lnbr32

Hi

I have just signed up for this deal myself having been denied the govt scheme for apparently having too much money (ha!).

The two banks our IFA told us about were Halifax and Nationwide. The Nationwide rate was by far the best but as ours is a flat we dont qualify as there is a minimum LTV ration of 70 (with CC you are looking at an 80% ratio when taking into account CC's 15% and your 5% deposit). So we went with Halifax who do a higher rate at 5.19% fixed for 2 years. Our application is being looked at at the moment so I'll let you know if we have any luck!!

Did you manage to negotiate a deal on price/extras with CC or havent you got that far? They told us they didnt 'do' offers on this scheme but we managed to get all our flooring thrown in.

Hope that helps!

buenfoxa

lnbr32 wrote: »

Hi

I have just signed up for this deal myself having been denied the govt scheme for apparently having too much money (ha!).

The two banks our IFA told us about were Halifax and Nationwide. The Nationwide rate was by far the best but as ours is a flat we dont qualify as there is a minimum LTV ration of 70 (with CC you are looking at an 80% ratio when taking into account CC's 15% and your 5% deposit). So we went with Halifax who do a higher rate at 5.19% fixed for 2 years. Our application is being looked at at the moment so I'll let you know if we have any luck!!

Did you manage to negotiate a deal on price/extras with CC or havent you got that far? They told us they didnt 'do' offers on this scheme but we managed to get all our flooring thrown in.

Hope that helps!

We haven't got that far in terms of the actual deal but would hope to get carpets and maybe stamp duty but not sure in reality if this would be possible.

I have seen the Halifax one - what sort of rates where Nationwide offering?

lnbr32

It was 3.4 something % - sorry ive forgotten the exact amount! Have you spoken to the Charles Church IFA? They dont charge, they only take commission from any mortgage they broker for you, so they are well worth their salt in terms of advice. Ours is a legend, and totally on our team. Were trying for some free extra fittings and stuff this weekend so I'll let you know how we get on!

buenfoxa

Yes spoken to IFA recommended by CC but we are in a slightly different position to you as we currently have a residential mortgage with Halifax which we wish to keep in order to rent that house out. The IFA state that only Halifax and Leeds BS will lender on the 85/15% which isn’t a government approved scheme, with Leeds BS having a 7.69% rate! Obviously we couldn’t use Halifax as we intend to keep our existing mortgage and not tell them it is being let (Consent to Let would be 5.5-6.5% rate which would push the mortgage up to circa £750p/m).

I would be interested to know the Nationwide criteria/rates!

lnbr32

Ah I see, the Nationwide is a first time buyer mortgage so that sounds like it rules you guys out Apparently theyre near imposiible to qualify for anyway.

r83_2

Hi lnbr32 - Sorry to have jump in from nowhere. I have applied for shared equity scheme on Monday (25-75%) with 5% deposit paid by us and 20% by the developer Persimmons homes. When did you submit your application to Halifax for the mortgage? Have you heard anything from bank/broker as to where you are with your application? Its agonising wait I believe !!

lnbr32

Hi r83! I know its soooo slow! Actually our broker submitted ours on Mon 5th. The valuation was done that week and now apparently theyre looking through our paperwork and proofs. Ill let you know when we hear anything else!

r83_2

Sweet! I am a week behind, halifax charged my credit card for Valuation fees on monday the 12th itself!!! IDK when would the valuation be done. But briefly spoke with Administrator at the broker's office who have advised that the valuation has been instructed yesterday and case is with underwriter! Every FTB's nightmare begins and ends with word "UNDERWRITER" :rotfl: Bless FTBs lol. Keep us posted and I will as well.

brit1234

Guys & Girls

Please do your research into the bad aspects of shared equity as well as the good. It could be a costly mistake.

We have a good debate (pros/cons)on the subject on this thread:

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

Just because the developer contributes to your deposit doesn't always make it a good idea.

Yorkie1

buenfoxa wrote: »

Obviously we couldn’t use Halifax as we intend to keep our existing mortgage and not tell them it is being let (Consent to Let would be 5.5-6.5% rate which would push the mortgage up to circa £750p/m).

Nice approach. What will you do if and when Halifax find out? Or the tenant sends your mortgage correspondence back to the lender because you can't have a permanent redirection? Or your insurance doesn't pay out because it's not LL's insurance? Or your LA / tenant is actually clued up and asks for evidence of CTL?