Shared Ownership Mortgages

maria_my

Hi,

Does anyone know which lenders offers shared ownership mortgages? We have a 10% deposit for the share we are going to buy but most lenders seem to exclude shared ownership properties....

Waiting to hear back from a broker but would appreciate your advice too.

Thanks xx

brit1234

Only a couple of lenders do shared ownership, there is a reason. I strongly recommend you do the research into shared ownership before you proceed further, many of us MSE fans are not fans.

I think Halifax and Nationwide do the mortgages, others have pulled out.

maria_my

Thanks, we will no doubt read the small print and then decide whether it is for us, but in our view theres no point even considering it if we cant get a mortgage for it. I'll have a look at nationwide, there website says for s.o. you need to pop into their branch. Thanks for the advice and pointers!!!!

Muhasib

brit1234 wrote: »

Only a couple of lenders do shared ownership, there is a reason. I strongly recommend you do the research into shared ownership before you proceed further, many of us MSE fans are not fans.

I think Halifax and Nationwide do the mortgages, others have pulled out.

What is the reason?

kingstreet

You're sure it's shared ownership?

Please describe how you are purchasing the property.

charleyroo

Hello,

I have a shared equity mortgage with Nationwide and I applied through my mortgage advisor.

As far as I'm concerned I ended up with a great rate (3.59%) with only a £5k deposit and no interest to pay (ever) on the 30% that the H.A. loaned to me - just their 30% of the profits should house prices rise. Small mortgage, and small repayments. Works for me

Read the small print though.

charleyroo

brit1234 wrote: »

I think Halifax and Nationwide do the mortgages, others have pulled out.

Natwest do them as well, those 3 are the only ones who have ever done them. No one has pulled out.

saverbuyer

charleyroo wrote: »

Hello,

I have a shared equity mortgage with Nationwide and I applied through my mortgage advisor.

As far as I'm concerned I ended up with a great rate (3.59%) with only a £5k deposit and no interest to pay (ever) on the 30% that the H.A. loaned to me - just their 30% of the profits should house prices rise. Small mortgage, and small repayments. Works for me

Read the small print though.

I'm sorry are you saying your 30% equity share is an interest free loan without a time limit imposed in which it must be paid? Do you pay rent for the 30% share you do not own? How much rent and what is the 30% share worth when you bought?

charleyroo

Hello

Yes, it's an interest free loan without a time limit. I don't pay rent on the 30%, I just have to give the housing association 30% of any profit (in the case of an increase - if the value is less when I sell, they take 30% of the loss) minus any improvements I make to the property (they minus the value of improvements from their share of the profit). I was also able to buy on the open market, but they gave me a price limit of what I was able to buy.

Overall I believe this opportunity was extremely rare and I was very lucky to be given it, I know a lot of SO/SE have lots of holes and small print (not all of them though).

The 30% was worth £39,195 in March.

Happy to answer any other questions if it helps...

saverbuyer

charleyroo wrote: »

Hello

Yes, it's an interest free loan without a time limit. I don't pay rent on the 30%, I just have to give the housing association 30% of any profit (in the case of an increase - if the value is less when I sell, they take 30% of the loss) minus any improvements I make to the property (they minus the value of improvements from their share of the profit). I was also able to buy on the open market, but they gave me a price limit of what I was able to buy.

Overall I believe this opportunity was extremely rare and I was very lucky to be given it, I know a lot of SO/SE have lots of holes and small print (not all of them though).

The 30% was worth £39,195 in March.

Happy to answer any other questions if it helps...

Who was the HA and what was the name of the scheme? That is a fantastic deal. There is really no upside for the HA. They give you 40k and potentially will never see any return whilst you live in that house. Could be for 70 years. This is the only time I have ever heard of anything like this.

kingstreet

We have the usual confusion over the difference between shared ownership and shared equity, which is why I asked the question earlier.

A lender doing shared ownership will not necessarily do shared equity - Abbey for example.

Be careful you understand which is which.