keyworker mortgage nightmare!

blues

I will just add that this scheme worked very well for me (and a number of my colleagues at the time). After buying a small flat with the help of Tower Homes in 2005 & selling last year, I've been able to buy a 3 bed house. I was fortunate that my flat was in London & its value rose considerably.

Jane10o0

Just wondering...I have a key worker equity loan around 37%of property and although my lease is fairly ok atm I'm warning to extend for piece of mind...Since Tower homes/L + Q will benefit from my property having a longer lease, can I share the costs with them?? Unlikely I know but logically it should be th case no?

Sparkles75

Has anyone had any success porting their loan to buy a new property? Many thanks

Fjan

Hi,
I am really in need of advice and can’t believe the original company I used for the help to buy scheme (Tower Homes )does not exist ! I don’t have any of tot original paperwork and am about to sell my property .
I bought my flat in London in 2005 for £147 . I agreed to Tower Homes help to buy scheme where they gave me 47k (33%) towards the purchase . It has made a good profit but I distinctly remember signing an agreement which stated that if I wanted to sell the flat , I would pay Tower Homes the 47k back in addition to a percent of the interest .
Now that L& Q have taken over ,(which was firstly a shock to me as I’ve had zero correspondence about this ) I’ve been told that I need to pay back 33% of the market value . It’s now valued at 260k but I’ve agreed to sell it for 250k . That’s 85,600k going straight to L&Q group ,
I feel completely misled and trapped into an agreement which I did not agree to in the first place . I have asked L&Q to provide me with every piece of documentation linked with this scheme and my flat .
I feel like such a fool agreeing to this Help to Buy scheme . I would never have agreed to it if I had known that a, the company would disappear into thin air b, a new company would take over and make a new set of rules which have huge financial implications .
This isn’t right . Can anyone offer any advice ?

Fjan

Did you end up paying a huge amount to them ?
I’ve been told by L&Q I need to pay 33% of the current Marjet value even if I can’t find a buyer who will pay that .
L&Q will be making £85,600 from me when they only gave me 47k . I don’t ever remover signing this agreement . I recall signing one that stated that I would pay one percent of the interest made on top of paying the 47k
I can’t believe I don’t have the original paperwork .

Fjan

Please ignore the typing errors . I’m new to this forum and was typing in haste . Please see the edited version :

Did you end up paying a huge amount to them ? I’ve been told by L&Q I need to pay 33% of the current Market value even if I can’t find a buyer who will pay that .
L&Q will be making £85,600 from me when they only gave me 47k . I don’t ever remembet signing this agreement . I recall signing one that stated that I would pay one percent of the interest made on top of paying the 47k
I can’t believe I don’t have the original paperwork .

davidmcn

Fjan wrote: »

Did you end up paying a huge amount to them ?

Who are you asking? You've added to a thread which started in 2012. The OP has never logged in again since they asked their question, so I wouldn't expect them to be paying attention.

sarahsaucepot

Hi
I’m the original OP and never logged back in to this thread as too fed up! I happened to google search ‘keyworker mortgage con tower homes’ and this came up; I googled this as my friend who bought the same time as me on same scheme is tying to sell her flat now.
Like you we bought in London but for me, the year we sold there was a dramatic drop in prices. We sold for a couple of k more than bought. We had to pay % of new price which is what we expected.

Someone above said what about renting the flat but this was against the rules according to L and Q (company who took over Tower Homes - I never received any correspondence about this either...) and also cannot port the loan (someone asked if anyone had been able to
Do this - no not me). We sadly sold and decided to rent as couldn’t afford a bigger place here and are still renting now never able to buy again. We had a child and I was pregnant with a second so didn’t really know what else to do - I regret it all every day.

I did write to my MP to complain I was misled and also complained to L and Q but they kept seeing me saved PowerPoints from the original presentation Tower Homes did stating the ‘not portsble’ Small print and to be honest due to my personal al situation at the time I gave up trying as it was all too much . Unfortunately I had a miscarriage two weeks after moving and although I’m sure all the stress didn’t make this happen I can’t imagine it helped my health much.

Anyway Fjan, sorry to be the bearer of bad news! My friend went to see several financial advisors , many of whom had never heard of the scheme and didn’t understand it or some who had and said it was the worst thing they’d ever had to deal with. I went with her to a mortgage meeting at Yorkshire bank who were the mortgage lenders and heard him with my own own ears say what a terrible scheme it was. He just advised selling and starting again - luckily she stayed in her flat longer and has made more profit but still round here can’t afford much better on her own as a ‘first time buyer’ despite paying mortgage for 15 years... Also she has a very short lease and is not a freeholder as I was luckily and was never fully informed about the implications of this when selling. She’s very low about all the difficulties she’s facing, not least the fact that L and Q are very bad at communicating and there are lots of extra fees to pay... I just hope she sells , buys somewhere ok and on a normal mortgage so is out of it all ASAP.

All in all this version of the scheme was a terrible idea and not fully explained and I still believe we were misled . I wish I’d never done it. Good luck , get some advice from your mortgage lender and a decent independent financial advisor (mine from Tower Homes approved list doesn’t seem to exist anymore.... 😳🙄).

Hope all goes ok.

silvercar

The current Help to Buy scheme has similar conditions - you borrow 20% as an interest free loan. After 5 years you are charged interest at an increasing rate, when you sell you repay 20% of the current value.

blues

The original agreement did say that you pay back the original loan from Tower Homes (50k in my case) which was 33% of my purchase price and then 33% of any profit made.

I was fortunate than when I bought L&Q out of the deal, my flat was valued at the same price I paid for it so I just paid back the 50k. When I actually sold the flat a few years later, it sold for twice the price I bought it for, so it worked well for me as I took all the profit. Lucky I know.