Right to buy rules?

Jeanine1977

We bought our house under the right to buy scheme 2 years ago and we are currently looking at a remortgage and a 2nd charge, to complete an extension to give us more room. We have been told that if we borrow additional funds and or extend the property (within the first 5 years) it will trigger the discount as it is classified as an effective sale of the property and a change of deeds. I can't find where it states this anywhere in the guidelines and was wondering if anyone had come across this before?

strawb_shortcake

I am not sure that's quite correct, where the problem may be is if a second charge is put on the property, should a repossession or sale occur there may not be enough equity in the property to cover the charges, and the mortgage redemption.

Norman_Castle

Jeanine1977 wrote: »

We have been told that if we borrow additional funds and or extend the property (within the first 5 years) it will trigger the discount as it is classified as an effective sale of the property and a change of deeds.

Told by who?


https://righttobuy.gov.uk/agent-service/

ACG

Sounds like you have either been given incorrect information or there is a misunderstanding somewhere. You may struggle to get additional funds, but not for the reason that you have stated.

Jeanine1977

This was part of the response I received from the home ownership department

"Any kind of change of charge or extra charges mean you have to repay the discount, as it counts as a sale in effect. This is at the valuation currently and not the price you bought it for. This means that you could well pay back more than your original discount, as it’s based on current market value"

I've calculated the discount repayable and additional funds and there is enough to pay all lenders and the discount. The lady also told me that a woman was made to repay a discount because she changed her name after a divorce as she changed the deeds.

davidmcn

Jeanine1977 wrote: »

The lady also told me that a woman was made to repay a discount because she changed her name after a divorce as she changed the deeds.

Merely changing your name certainly doesn't trigger a repayment, that's absolute nonsense.

Norman_Castle

Jeanine1977 wrote: »

The lady also told me that a woman was made to repay a discount because she changed her name after a divorce as she changed the deeds.

I'd suspect the divorce involve removing her ex partner from the deeds and re mortgaging and not simply changing her name.


Op, try asking here for clarification.
Right to Buy Agent Service
Telephone: 0300 123 0913

Jeanine1977

We applied for a 2nd charge and we are now having to put everything on hold, from whet the woman told me they are meeting with the legal team to discuss what are the rules are re development and changes to deeds, as they are not clear and people are being made to pay back discounts on what I see as technicalities. I was astonished when she told me a woman had been made to pay back £45k of her discount because she divorced and change her name and her husband was removed from the deeds. It was classed as a change of charge!