Mortgage after a dro for 25% shared ownership

alan1502

Hi all my dro is about to finish and hopefully my debts will all be clear I'm looking at getting at the property market and have seen some homes that are shared ownership and 25% would be about 23k I was wondering what is the odds of getting a mortgage for that I'm hoping since it's not loads of money they will say yes but got a feeling it will be a no! I can raise a deposit for this no problems within a couple of months since I will be financially better off any advice in this would be greatly appreciated wether it be about the mortgage or how shared ownership works thanks alan

Jon81

alan1502 wrote: »

Hi all my dro is about to finish and hopefully my debts will all be clear I'm looking at getting at the property market and have seen some homes that are shared ownership and 25% would be about 23k I was wondering what is the odds of getting a mortgage for that I'm hoping since it's not loads of money they will say yes but got a feeling it will be a no! I can raise a deposit for this no problems within a couple of months since I will be financially better off any advice in this would be greatly appreciated wether it be about the mortgage or how shared ownership works thanks alan

I currently have a shared ownership property at 50% share and while they are a good idea and support to get on the housing ladder there's a few things to consider

Do your research about the housing association and their track record on doing repairs ect

While you may be eligible for a mortgage the housing association will do their own affordability checks

When you come to sell theyll likely keep around 0.5% of equity per year of residence so in my case I'll lose 4.5% of my equity into their sinking fund. This is key as its contractual but you don't apriciate the effect until you sell

(For me the sinking fund is a pivotal consideration in so much as if house prices stall or decline you might not have any remaining equity after paying the housing associations sinking fund cost)

Check the build quality of the propety and make full use of their offer of repairs during the snagging period. These places are built to a cost and sometimes corners are cut, if an apartment this means you are responsible for all costs internally.

You'll likely pay more in rent and service charge than mortgage and rent increases yearly

Often the service charge doesn't bear resemblance to the schedule of upkeep or work the housing association say they'll do. Example changing communial carpets every 5 years done after 7

When you sell the housing association will likely want first refusal at marketing your property for three months or paid to release their right

When you do sell they'll vet the potential applicant

Killerseven

do you mean your first year is almost up. or the 6years?

alan1502

Thanks Jon for the advice obviously there is quiet a bit to consider in regards to shared ownership but I think it will be my only chance to kind of get on property ladder and killer seven it's my first year that's nearly up