Shared ownership lenght of stay

Rocksolid

Hello,

I'm evaluating this formula in UK, but I didn't read anywhere for how long I can stay, or the lenght of staying goes alongside with the lenght of the mortgage?

AdrianC

Your question makes no sense. Would you like to re-word it?

Shared Ownership in the UK is typically where you own a proportion (say 50%) of the property, and rent the rest from a housing association. You would then live there as your main home for years.

G_M

AdrianC wrote: »

Your question makes no sense. Would you like to re-word it?

Shared Ownership in the UK is typically where you own a proportion (say 50%) of the property, and rent the rest from a housing association. You would then live there as your main home for years.

meaning for as many years as you continue to pay the rent on the rented proportion, the mortgage (if any) on the owned proportion, or until you choose to sell your share.

Carrot007

AdrianC wrote: »

Your question makes no sense. Would you like to re-word it?

Shared Ownership in the UK is typically where you own a proportion (say 50%) of the property, and rent the rest from a housing association. You would then live there as your main home for years.

Indeed, to add.


You would buy out the other owner at the "going" rate if you wanted to stop paying rent. Or give the "going" rate to the other owener if you want to move.


I say "going" rate as it is likely to be inflated and taking less than your percentage is usually the only option.

Rocksolid

@AdrianC how many years do you mean?
Example:
Shared ownership at 50%, mortgage for 25 years, I pay the mortgage for 25 years, can I remain for 25 years there?
That was the main purpose of my question.

Now another pops up, the rent will be paid only at the end of the share, in the middle or from the beginning?

Anyway the full ownership has to be specified in the contract, many don't offer to release the house...

AdrianC

If you buy your 50%, you can live there until the day you die - assuming you keep paying the rent and the lease doesn't expire.

When the 25yr mortgage reaches the end, then you've simply paid back all the money you borrowed to buy your 50% with. You still own 50%, just as you did from day 1 - you just aren't repaying anybody any more, because you don't owe them money any more.

You pay the rent on the other 50% every month.

KatrinaWaves

You pay the rent at the start, beginning, and end. You pay it every month.

After the length of your mortgage you own some of it, but you still have to pay rent. If you don’t want to pay rent anymore you need to sell the part you were paying a mortgage on.

G_M

On day one you buy 50%. It's yours. For ever.
But maybe you don't have enough money at the time to buy it,so you borrow the money, via a 25 year mortgage.
Sofor 25 years you pay back the mortgage.
After that you don't owe anything more for the 50% you own.


On day one you rent the other 50%.
So you pay rent monthly for the rent.
You continue to pay this rent for ever (or till you die, or move).


But you will have the option later to buy the 50% your are renting.
Maybe you buy the full 50% you are renting. Then you will own 100%!

Rocksolid

So, I need to pay mortgage + rent, well then how it can be convenient?
I may understand in case you already have the 50% in cash, but even in that case is always better to buy at take a 50% mortgage...

Do the people take a mortgage for shared ownership?
I don't think so, as having around 50-100k in cash is not normal.

KatrinaWaves

Sorry but your questions are confusing.

If you buy a ‘normal’ house you borrow the money for entire house and pay it back through a mortgage.

If you rent a house you pay rent.

If you buy a shared ownership house you buy HALF the house and you rent HALF the house. You can buy half the house however you want, same as any house, with cash or with mortgage.

I do not know what you mean by ‘how is it convenient’ if you mean ‘why do people do it’ then it’s because they want to buy a house that they cannot currently afford, so buy some of the house and rent some of the house.

Rocksolid

Thank you both.

@KatrinaWaves, I don't understand how is convenient because the mortgage + rent is easily the same price of the full mortgage on an house, I'm just talking about the amount of money monthly.