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    • margaretclare
    • By margaretclare 4th Nov 17, 4:51 PM
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    margaretclare
    Right to buy
    • #1
    • 4th Nov 17, 4:51 PM
    Right to buy 4th Nov 17 at 4:51 PM
    Just a question about RTB - for a relative.

    RTB is acquired after being council tenant for a number of years. Suppose tenant is allowed to buy property in which she lives, with the years of tenancy being used to discount the price.

    Is a money deposit required as well as the tenancy years set against the property value?

    This is where I may be able to help GD, but it's an area that I'm completely unfamiliar with.
    r ic wisdom funde, r wear ic eald.
    Before I found wisdom, I became old.
Page 1
    • HampshireH
    • By HampshireH 4th Nov 17, 4:56 PM
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    HampshireH
    • #2
    • 4th Nov 17, 4:56 PM
    • #2
    • 4th Nov 17, 4:56 PM
    Depends on the lender. Many take the discount some ask for a deposit.

    The government help sheet on their website should help.

    http://righttobuy.gov.uk/mortgages/
    • margaretclare
    • By margaretclare 4th Nov 17, 7:30 PM
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    margaretclare
    • #3
    • 4th Nov 17, 7:30 PM
    • #3
    • 4th Nov 17, 7:30 PM
    Thanks for this. Yes, I actually read the site but that little bit escaped me.

    I'd like her to have a decent deposit even if one isn't asked for. She may as well have it when she needs it rather than when I die. I envisaged, with a deposit, she'd have lower repayments or an earlier end to the mortgage debt.

    She has a few things going on at the minute but will probably start the ball rolling in the new year.
    r ic wisdom funde, r wear ic eald.
    Before I found wisdom, I became old.
    • ACG
    • By ACG 4th Nov 17, 7:53 PM
    • 16,831 Posts
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    ACG
    • #4
    • 4th Nov 17, 7:53 PM
    • #4
    • 4th Nov 17, 7:53 PM
    There are a few lenders who will allow the discount to be the deposit.
    You are also able to put down an additional deposit if you like/able to and that would potentially open you up to lower rates and also lower payments (as the mortgage would be lower), but there is no requirement to do so.
    I am a Mortgage Adviser
    You should note that this site doesn't check my status as a mortgage adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.
    • margaretclare
    • By margaretclare 5th Nov 17, 6:05 PM
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    margaretclare
    • #5
    • 5th Nov 17, 6:05 PM
    • #5
    • 5th Nov 17, 6:05 PM
    There are a few lenders who will allow the discount to be the deposit.
    You are also able to put down an additional deposit if you like/able to and that would potentially open you up to lower rates and also lower payments (as the mortgage would be lower), but there is no requirement to do so.
    Originally posted by ACG
    Thank you very much. That was exactly what I hoped to do.

    It's not for me, but for my eldest GD.
    r ic wisdom funde, r wear ic eald.
    Before I found wisdom, I became old.
    • Mojisola
    • By Mojisola 5th Nov 17, 6:44 PM
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    Mojisola
    • #6
    • 5th Nov 17, 6:44 PM
    • #6
    • 5th Nov 17, 6:44 PM
    I'd like her to have a decent deposit even if one isn't asked for. She may as well have it when she needs it rather than when I die.

    I envisaged, with a deposit, she'd have lower repayments or an earlier end to the mortgage debt.
    Originally posted by margaretclare
    This would be useful but it may also be important for her to have a lump sum in savings to pay for maintenance and repairs.

    If someone doesn't have much income, buying their council house isn't always the best option. A secure tenancy is a very valuable thing.
    • Red-Squirrel
    • By Red-Squirrel 5th Nov 17, 8:59 PM
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    Red-Squirrel
    • #7
    • 5th Nov 17, 8:59 PM
    • #7
    • 5th Nov 17, 8:59 PM
    This would be useful but it may also be important for her to have a lump sum in savings to pay for maintenance and repairs.

    If someone doesn't have much income, buying their council house isn't always the best option. A secure tenancy is a very valuable thing.
    Originally posted by Mojisola
    Exactly what I was just about to say. Its lovely that you want to help your granddaughter out (especially when most of the RTB threads on here seem to be people wanting to fleece their elderly parents!) but there is a lot of value in a secure lifelong tenancy with the council responsible for maintenance, and with benefits payable if the tenant is out of work etc. (not the case with a mortgage) so its definitely worth seriously considering the risks of giving it up.
    • deannatrois
    • By deannatrois 5th Nov 17, 9:28 PM
    • 5,371 Posts
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    deannatrois
    • #8
    • 5th Nov 17, 9:28 PM
    • #8
    • 5th Nov 17, 9:28 PM
    If your GD can't save a deposit, how is she going to repair the place if something major goes?

    Are you sure she is living within her means?

    Giving a deposit if she can't provide one herself could lead to some negative things like losing a place to live if she has problems.
    • margaretclare
    • By margaretclare 10th May 18, 10:08 AM
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    margaretclare
    • #9
    • 10th May 18, 10:08 AM
    • #9
    • 10th May 18, 10:08 AM
    Update on this.

    I gave GD the good advice given here, about the advantage of being a council tenant. She continued as she was - in a joint tenancy (not a partnership) and has had a new bathroom and new boiler.

    We've now had the decision forced on us. The person who has the other half of the tenancy has, over time, become impossible to live with. GD is a hard worker, skilled, a painter and decorator, has her own car - her fellow-tenant is anything but. He doesn't work, is on benefits but doesn't pay his way which makes things very difficult for her. To cut a very long story short, this week the crunch came. He wants to give up the tenancy because he 'wants his own space'.

    GD has been in touch with the housing officer and been offered the house for 70K with a 35% RTB discount. That leaves 45K with a 10% deposit.

    As I promised her long ago, I'm giving her the 4.5K deposit. I'm realising some of my investments. An advance on her legacy, you could say!

    She has had this forced on her at this moment in time, so although there were advantages in being a secure tenant, she'll actually be paying less on a mortgage to the council than she was paying in rent.

    What the other half of the tenancy intends to do is not clear. Not our business. There are some people in this world that, try as you might, you just cannot help.
    r ic wisdom funde, r wear ic eald.
    Before I found wisdom, I became old.
    • da_rule
    • By da_rule 10th May 18, 10:17 AM
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    da_rule
    Just to clarify, the 70,000 is the open market valuation, not the value after discount?
    • margaretclare
    • By margaretclare 10th May 18, 10:34 AM
    • 10,123 Posts
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    margaretclare
    Just to clarify, the 70,000 is the open market valuation, not the value after discount?
    Originally posted by da_rule
    No, the value after discount is 45,000.
    r ic wisdom funde, r wear ic eald.
    Before I found wisdom, I became old.
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