Selling a property to local housing association

290784

Looking for some advice as I have tried searching the internet and havent had much joy so I am looking to see if anyone has had any experience with selling their property to a local housing association or council?

A friend of mine going through a hard time around 5 years ago, husband had left her and the kids and she was struggling with the bills/mortgage etc. A colleague told her that if she was looking for a quick house sale then the housing association would buy the house from her. She had around 100k left to pay to her mortgage and the housing valued the property at the time at £150k. They didn't send anyone out to survey the property they just went on an average price of the properties in the area at the time and being in a vulnerable situation she didn't really question it too much and agreed to the sale, it was also agreed that she would remain a tenant of the property. The housing association paid the mortgage off for her with the £100k and then the £50k she expected to get from them which would be her own money however they told her that it doesn't work like that & that the money goes to the Government. 

Few years on and she is still living in the property however she is now renting this off of the housing association (the rent is now almost more than her mortgage payments would have been) and from speaking with some people recently it has got her thinking that the whole process was not correct at all. Why would the Governement be entitled to the 50k after the mortgage had been paid off? As mentioned above she was in an extremely vulnerable position with no help so assumed that advice she was given was people trying to help her out and she didnt know enough to question anything.

She has been advised to speak with a property solicitor for more advice so she is looking into making an appointment for this but if anyone has done this before or knows anything about this process then it would be great to hear.

user1977

Presumably she had a solicitor at the time - what was their advice? Does she have a copy of the contract? If she had 33% equity then why didn't she sell in the usual way?

strawb_shortcake

Was the house bought under right to buy? Could be that the £50k was repaying the discount? 

silvercar

I can't believe someone could be in a situation where the fact they won't get an expected 50k wasn't explained to them at the time, before they committed to the deal.

Norman_Castle

Very odd the HA bought the property then allowed her to stay as a tenant.

user1977

Norman_Castle said:

Very odd the HA bought the property then allowed her to stay as a tenant.

Doesn't seem all that odd to me - I've previously been involved in a scheme where local councils were buying properties from owner-occupiers at risk of repossession, and keeping them on as tenants. The council gets to increase their housing stock, and the owner is saved from entering the homelessness system. But I don't remember anything odd happening with the price, though by definition these were cases where there wasn't much (if any) equity.

HampshireH

Norman_Castle said:

Very odd the HA bought the property then allowed her to stay as a tenant.

As above.  Not odd at all and usually occurs where somebody has been a shared owner though not unheard of in outright owners.

I've not seen it happen where someone chose to with equity it has always been repossession.

OP your friend would have had a solicitor and they would have advised. Is it possible she had help to buy and had to pay it back.