Shared ownership

Hi everyone,
we have just bought our first home 🎉 finally! We have bought via shared ownership and have a mortgage of £49k. We have taken to mortgage over 35years to give us the flexibility to over pay most of the year but have reduced payments around Christmas and also enable us to pay the lower amount in a few years when I move onto a medicine degree as I will have to give up full time nursing then. We can over pay 10% a year penalty free. However as the mortgage amount is quite small we are ideally looking to over pay the 10% and save more in savings so at the end of the term we can remortgage and buy the full property. Hopefully keeping payments the same is now of combined rent/mortgage. So a few questions: is it 10% of the overall mortgage I can over pay or 10% of the remaining balance after the year? Effectively reducing the amount I can over pay? I think it’s the last but just wanted to make sure. Also can anyone advise if their is a better strategy to this? Like I said we are FTB so not as savvy with this as some. Thank you .

Replies

  • Ellie78Ellie78 Forumite
    195 Posts
    100 Posts Second Anniversary Photogenic Name Dropper
    Hi Mcgough221, congrats on your 1st house!
    It's usually (but not always) 10% of the remaining balance you can OP without penalty.   If you can't find the info in your mortgage paperwork you should be able to find the information on your lender's website easily enough.
    Good luck.
    Mortgage - £23,500 remaining
    MFW2021 #8 - £2,519.77/£3,000
    Overpayments: 2020 - £4,722.83 / 2019 - £16,042.00
  • Heskey09Heskey09 Forumite
    8 Posts
    Name Dropper First Post
    @Mcgough221
    Congratulations - just going through the same. Can I ask if you came up against the 'must exchange within 28 days obstacle?'. Everything is go slow but we are worried we might loose the house.
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