Compare shared ownership mortgages
A shared ownership mortgage is not the same as a normal joint mortgage you’d take out with a partner. The ownership in this case is shared with a housing association, which retains 50% to 75% of the value of the property, thus helping you get a foot on the property ladder for a half or quarter of the price. You do, of course, only own a quarter or half the property and won’t be in quite such a strong position as if you owned the whole property should price rise, but at least you’ll own something!
What about the 75% of the property a shared ownership mortgage doesn’t buy me?
Whatever percentage of a property your shared ownership mortgage helps you purchase, you’ll rent the remainder from the housing association. Housing associations are not out to make a profit, but to help provide affordable housing and a route to ownership for people who don’t have access to the six figure sums that home ownership seems to require in many parts of the country.
Can I buy any property with a shared ownership mortgage?
To buy a shared ownership property you need to find a housing association scheme first. Shared ownership schemes are now referred to as New Build HomeBuy. A shared ownership mortgage is generally available for specifically built or renovated properties. The housing association allows you to buy a slice of the property and to rent the remainder. Remember that housing associations are not looking to make a profit and your rent will be a maximum of 3% of the value of the bit you didn’t buy and is only allowed to go up inline with the Retail Price Index.
Do I need a good credit score to get a shared ownership mortgage?
It’s a good idea to ensure your credit score always reflects that you’re a responsible person to lend to. You can use an online service, such as CreditExpert right now to look closely at your own credit report online. If you see errors or inaccuracies, you can amend and update it to help ensure lenders aren’t misled. However, there are bad credit shared ownership mortgages. The whole point of new Build HomeBuy is to give access to affordable housing, but it’s a bank or other lender that lends you the money to buy your share with so you have to meet the lender’s eligibility requirements as well as the housing association requirements.
How do I find a property to buy with a shared ownership mortgage?
A good way to start to find a property you can buy with a shared ownership mortgage is to search online for ‘homebuy’ schemes. You also need to compare mortgages to ensure you get to see the best shared ownership mortgages on the market and get maximum value from your shared ownership purchase.
Experian® - the company behind LowerMyBills – also provides CreditExpert, which gives you access to your credit report and score enabling you to see what lenders see about you when they make a decision about which financial products or services are available to you.
The LowerMyBills.co.uk mortgage service is provided by BeatThatQuote.com Ltd, an appointed representative firm of Best Value Financial Services Ltd which is authorised and regulated by the Financial Services Authority.
YOUR HOME OR PROPERTY MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE.
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