Seperation and Shared Ownership query

AngelEyes91

Hello all,

I dont really know where to start with this.
My partner of 5 years ended our relationship at Christmas two months after buying our first home (we rented 4 years prev to this). We are currently still staying in the home address due to our jobs and our 2 year old son whilst we try and sell it, which probably wont be for a few months.
On the bright side we got the house for a good deal, the previous owner wanted rid so we got a house worth £310k for £285k. We are in a 5 year fixed deal so by the time we sell we will need to pay just over £12k ERC. Im aware of all of this and worked out that we should have around £19k each if it goes for £300k.
Right now im trying to work out what on earth im going to do. My life is here but i have no family around, my priority is obviously my 2 year old little boy and gaining a secure property for us.
I am looking at hopefully purchasing a 2 bed flat on the Shared Ownership scheme and i wondered if anyone has been through selling a house after a break up and getting a Shared Ownership property before. I cannot buy anything else on my own as i live in Oxfordshire and the house prices down here are very pricey.
I have a good job where i earn £28k per year so I know affordability wise it would be fine. Its just the timing of everything because really i need to go from the house to the flat (if im able to do that) does anyone know how this works or how i need to make this work?
There is a new build estate near us where i am looking, there are new developments most of the time, the last ones were autumn so i think it would probably be Autumn again this year.

My questions are-
- Can I reserve a plot before we get an offer?
- Will they accept me to have a mortgage since i have one currently.. obviously i know not at the same time but im hoping as i have one at the moment thats a good sign for them?
- My credit has slightly gone down due to taking the mortgage out and changing address and now not being in the address long, will that effect it or will they take my unfortunate circumstances into consideration? On experian my score is classed as "Good" on Credit Karma its classed as "fair". My last missed payment was three years ago but didn't seem to be an issue with getting the mortgage. I have no defaults, CCJ etc.

Any other advice is much appreciated, very daunting becoming a single mum and covering everything on my own.

Thank you in advance for your help

h240

Hello, sorry to hear what you’re going through just saw this and thought I could help as currently have a shared ownership newbuild house that we are going through the process of selling. So you cannot reserve anything else unless your current home is “under offer” we had to wait to be under offer before reserving another plot, and we have just reserved a newbuild but not shared ownership before we were looking at other shared ownership homes and each housing Association said the same that we had to be under offer first if that makes sense? We are in Hampshire so I’m not entirely sure who you’re with but double check their rules. It totally depends with regards to your mortgage, we are paying ours back when we move as luckily we have some equity and no early repayment charges (if you’re still in you’re fixed rate there will be charges for ending it early) we’ve just come out of our fixed rate so it’s only £80 to replay the mortgage early. Now we’re at the stages of waiting for a new mortgage offer with a different provider it’s because it’s not shared ownership now we’ve decided to use a different provider as we had the whole market to chose from as I remember with shared ownership not every lender deals with it. You’re best bet is to speak with a broker, did you use one to get your current home? We had to use this particular broker when we got our shared ownership house 2 years ago and he was great help when we decided to sell our current home and telling us what we could afford etc maybe you could ask your broker more and go from there? Hope it makes sense what I’ve said!

h240

Also it depends on your share etc we also have to pay the housing association 1.5% of OUR share when we complete which seems crazy but has to be done

h240

Also you’ve got stamp duty with buying another place to factor in not 100% what it is with shared ownership as depends on the share you purchase. We also had to pay to have a valuation done before our shared ownership house went on the market but your best bet is to ask the housing association what they charge and their process to sell and a broker

dimbo61

Hi AE91,
One step at a time.
Wow great timing after 5 years together.
5 year fixed rate deal with a £12,000 ERC.
Why do you think it will go up £15,000 a couple of months after you paid £285,000 ?
You might get lucky but once the surveyor values the property he/she can quickly check on the Land Registry how much you paid.
£28,000 is average pay and you will struggle to get a property in many parts of the country.
Where do your parents live ? Cheaper area ?
Can you transfer jobs to a cheaper area near family.
For now I would make sure all the bills and mortgage is paid to protect your credit score.
Maybe your brilliant at painting and transforming a run down property into a " Showhome " on the cheap ?
Take one day at a time and good luck to you and your little boy

h240

I was going to say our newbuild shared owernship was valued before we put it up for sale and it had increased by £5,000 after 2 years we live in Hampshire, south east. So i would be surprised if your home will increase that much plus you haven’t said what share you have on the property? Don’t forget to go through getting another shared ownership property you need atleast 5% deposit, to pay the legal fees etc and possible stamp duty depending on the share you would own

AngelEyes91

Thank you for your kind words. Such a rubbish situation.

Just to confirm my current property is not shared ownership, we own the house.
It’s definitely worth around £300k-£310k, I know this because it’s a big house and generally I know the prices of houses my size around here as we were looking for sometime and saw what they went for and the previous owner sold it cheap because her husband died so she wanted to get rid of the house quickly so she could downsize.
I know I would struggle to get a house of my own but with shared ownership my wage should be okay.
I don’t have any family around here and they live about 2 hours away which is too far for us. I also work for the emergency services and I love my job so my plan is to stay here.
I will definitely keep up with payments to make my score rise again.
Going to be such a rubbish year, I just want to know that I’ll be okay in getting another property for me and my little boy

h240

Oh sorry I thought you meant your current home was shared ownership. You won’t get a big share on that wage but depends on the flat price etc we bought a 2 bed newbuild house shared ownership 2 years ago on roughly the same wage with a 40% share but we put down a big deposit to help or we couldn’t had done it. You pay rent too so it’s not just the affordability on the mortgage it’s all of it as the rent goes up every few months! Also a service charge every month. Personally having done shared ownership I wouldn’t do it again, they are so strict you have to pass all the affordability checks with the housing association first, you have to use their brokers which aren’t cheap and your limited to lenders who do shared ownership mortgages. But it was our only choice at the time. Can your partner not buy you out as such so you don’t have to move?

haras_nosirrah

I am a shared ownership mortgage specialist and have specialised in it for 12 years

You will need to have your place under offer before the housing association will allow a reservation

Most lenders won't lend on a property that has not been sold for a minimum of 6 months so you won't be able to market it to anyone other than a cash buyer until after 6 months of moving in

Once you have an offer on yours you should be able to offer on a shared ownership subject to passing the affordability checks. The lender affordability and shared ownership affordability are not the same - you must pass both.

You don't have to use the housing association brokers so if they told you that h240 then that was incorrect. While it is a recommendation you can use any broker you want

h240

We had to use the housing Associations broker and their solicitors when we asked if we could use anyone else they said no because their brokers did the proper affordability checks at the time and found us the mortgage, but I guess not all housing associations are the same it was the case with ours

haras_nosirrah

Maybe that was just with your housing association but it certainly isn't the case with all of them - I am on the panel for 3 housing associations but clients don't have to use us and similarly I do mortgages for clients buying shared ownership with different housing associations I am not on panel for.