Right To Buy Mortgage

planteria

just helping a friend who has the right to buy a council flat. local building society doesn't have 'the product' available at the moment. i queried that, as it didin't occur to me why it would matter that it was rtb ie. the discount would in effect be the buyer's deposit. however, following further discussion, the building society cateogorise rtb purchases differently due to the obligation of the buyer to pay back a portion of the discount if they were to sell the property during the 5 years following the purchase.
is anyone aware of lenders who are supporting rtb purchasers at the moment? are these strange times resulting in this being difficult?

thaddy

Some high street banks do them like Halifax and Nationwide. If possible your friend should try to get a mortgage broker to make the process easier.

planteria

thank you thaddy. Nationwide and Halifax are both useful options. 
i'm not sure if there has been a pull back from RTB lending by some lenders.

thaddy

I am not aware of any lenders who have pulled back on those type of mortgages they are just not openly advertised hence the need for a mortgage broker who has access to the whole market. As long as the discount covers the deposit amount needed for current LTV levels (which should easily be achieved with RTB) and the applicant(s) meet their criteria it should be accepted.

strawb_shortcake

It was 5 years ago now but we went with Natwest for our RTB, they didn't want a deposit as the discount was sufficient whereas when we approached Barclays they wanted us to pay a £10k deposit too.

planteria

that seems a bit demanding of them really anna, as the discount provides a buffer for the lender..

thaddy said: I am not aware of any lenders who have pulled back on those type of mortgages they are just not openly advertised hence the need for a mortgage broker who has access to the whole market. As long as the discount covers the deposit amount needed for current LTV levels (which should easily be achieved with RTB) and the applicant(s) meet their criteria it should be accepted.

West Bromwich Building Society have said they have 'pulled back' on them thaddy. 
i'm with you entirely re the discount covering the ltv level - in this case it is 50%, but the building society cateogorise rtb purchases differently due to the obligation of the buyer to pay back a portion of the discount if they were to sell the property during the 5 years following the purchase. they have said that they have a specific product which takes account of this, and that it is currently not available.

FtbDreaming

I got a halifax mortgage in August for right to buy. I did put £3300 deposit down too on top of the £9000 discount just to make myself more likely to be accepted really. 

planteria

thank you FtbDreaming.
from my understanding as soon as the flat concerned has become eligible for RTB he has a 50% discount, and then this doesn't increase for another 3 years, to 52%... so there's little benefit to waiting.

planteria

we've spoken to a broker today and it seems that obtaining a mortgage should be fine, with some lenders still supporting 'right to buy' purchasers. this flat is in a high rise which rules out some lenders too, but hopefully things will progress towards a decent deal despite that. 
thank you to those who responded above.