Shared Ownership, buy more shares or not?

General_Applause

You wouldn't be the first or only pensioner who rents.


Just claim housing benefit when the time comes.

cleg

Thanks for this advice re: only going to 60% I was concerned about resale at a higher percentage.

duaney

Is it viable to change mortgage lender in a shared ownership, the mortgage has gone up and the rent , I need to find a better way to pay it is an increase of £170 per month.

cjv

duaney wrote: »

Is it viable to change mortgage lender in a shared ownership, the mortgage has gone up and the rent , I need to find a better way to pay it is an increase of £170 per month.

You can remortgage as normal with shared ownership, but you are limited to less options than a standard mortgage as not all lenders offer this.

Search for some shared ownership mortgage rates and then have a chat with a broker.

Thebells2015

Is claiming housing benefit available for the rent aspect when you’re retired?

PasturesNew

For shared ownership, if you see yourself moving in the next few years it's probably not worth it as the larger the chunk you buy the fewer future buyers might be able to afford it.

If you're planning on staying/owning it all, it's best to do it soonest to get it out of the way.

[Deleted User]

Thebells2015 wrote: »

Is claiming housing benefit available for the rent aspect when you’re retired?

there is a specific scheme of Shared Ownership called retirement shared ownership or something equally obvious. Once you own 75% you don't pay rent on the other 25%

Otherwise, yes you can claim housing benefit for the rental part in the same way as a standard tenancy

kimbyanne

We are currently buying the remainder of our shared ownership house, we owned 55% and we are now buying the remaining 45% so we own it fully.

It’s not actually costing as much as I thought, with legal fees, stamp duty and the HA costs, it’s probably around £2.5/3k. We aren’t providing any deposit as we have about £20k in equity.

Petriix

Your best bet is to do whatever saves you the most money over time. Typically overpaying the mortgage is a good choice because you will save the compound of the interest for the remainder of the term. However, you might find that you can achieve a better saving rate at least in the short term - Nationwide offer 2.5% on your first £2500 balance for 1 year, so that might be better.

You are unlikely to save any money by staircasing at this stage: any reduction in your rent will likely be nullified by the increased mortgage payments. However, as you overpay you will increase your equity and may eventually have other options.

Uncle_Pennybags

Petriix said:

Your best bet is to do whatever saves you the most money over time. Typically overpaying the mortgage is a good choice because you will save the compound of the interest for the remainder of the term. However, you might find that you can achieve a better saving rate at least in the short term - Nationwide offer 2.5% on your first £2500 balance for 1 year, so that might be better.

You are unlikely to save any money by staircasing at this stage: any reduction in your rent will likely be nullified by the increased mortgage payments. However, as you overpay you will increase your equity and may eventually have other options.

I’m looking into either increasing equity by overpaying my 40% mortgage v staircasing to 100% and decreasing my relative equity. 

After a 75% pay rise, I naturally thought about staircasing to 100% thinking that it would be diverting so called dead rent money from the social landlord to the mortgage lender plus extra interest. 

I’ve found that my housing costs would more than double from the present 40:60 arrangement. This seems to be due to the extra interest on an open market mortgage as expected but  also due to the loss of subsidised rent. So the extra interest and the loss of the rent subsidy would represent a combined negative swing against my cash flow and see me pay more monthly than the open 100% rent of a comparable property (non S.106) 50m up the road!

i am siding with overpaying my 40% mortgage but I haven’t ruled out purchasing up to a maximum of 60% to protect myself from house price rises, then overpay the dominant share of the property.