Shared ownership worth it?!

GreenGooner

Hi all

My partner of 4 years and myself have found a 50% shared ownership property that we really like but I'm wondering whether we'll be accepted for the scheme.

We are both FTB... My partner has a good credit rating but I don't (recent late payments and a 12 month old default) so is it worth him being the sole applicant? Our share of the property is costed at £70000 and we have a £40000 deposit.

Is it acceptable to apply for a shared ownership scheme with such a high deposit?

Any help or advice would be muchly appreciated.

Calum_Young

Hi KT2409,


We were the same I had a good credit history but my partner had a few defaults due to a redundancy a few years back - id didn't seem to affect us when we applied - may be different as yours is not so long ago.


We have just got accepted on shared equity to, its a great way to do it as you get a better mortgage rate with will enable you to build equity quicker.


I would suggest that you put down the minimum deposit possible as they might not accept you on the shared equity with such a large deposit. You could then pay lumps into your mortgage to bring the balance down - we got ours through nation wide and we can pay back 10% per annum - 7k a year in your shoes! We couldn't have a deposit over 10k.

mashmash90

When we did our assessment they said you have to 'maximise your affordabiility'. So instead of buying a 50% share, they might make you get 75% for example as you have enough deposit for it- which is better surely for you as you're paying more towards a mortgage than throwing money on rent.

GreenGooner

Thank you both for your responses. My credit history took a hit when I went back to uni. I have only recently graduated and have secured a good job but still working hard to repair the damage.

If he were to take a sole mortgage, is it possible to declare that I contribute to the bills? We currently split everything 50/50. I'm just worried that if this is not possible then he may fail on the affordability checks.

SailorSam

I've never tried it but i imagine it makes it harder to sell when you wanted to move on.

kimbyanne

Is it a new build?

Ours was a new build and I know it wasn't a case of buying the percentage you wanted, it was a set percentage (40%-60%), and the H/A would decide the percentage you could purchase, so even if you could afford 70% you could only go to a max of 60%. Also meaning you could go in wanting to buy 40% but the HA thinks you can afford a bigger percentage, they will offer you the higher percentage.

Other things to consider, you can't earn more than £60k (combined), its higher in London though, you can only have one spare room, so a couple can only buy a two bedroom property, etc. I do also believe there is a limit to how much you can have in savings, so you may have an issue if you have a £40k deposit.

I also think if you are both planning on living there, you have to both be on the application.