If you are struggling to get onto the property ladder, you may find that utilising a government scheme could help! There are many different schemes available to help buy a property and some of them will benefit you and your situation more than others. This scheme is unique due to its ability to let you take out a mortgage on a percentage of a property and pay the rest back through rent.
You may find it strange to think that you can take out a mortgage on a part of a property, however, it's very popular! As a mortgage broker in London, we regularly see applicants wanting to purchase a property through the Shared Ownership scheme.
The share you can buy is usually between 25% and 75%. You can buy a 10% share on some homes. The remaining percentage is owned by the local authority or builder. You will not only have your usual monthly mortgage repayments, but you will also have to pay rent on the remaining property share. Shared Ownership homes are always leasehold, which also means you'll be paying ground and service charges.
We will make sure that you qualify for the Shared Ownership scheme before you prepare your application, we don't want you to be declined! You will need to meet these requirements prior to being able to take out a mortgage via the Shared Ownership scheme.
If you are in the market for additional Shared Ownership mortgage advice in London, feel free to take a look at our YouTube explanation above. We also answer common Shared Ownership FAQs just below if you need further information regarding Shared Ownership mortgages in London.
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Shared Ownership allows you to take out a mortgage on a percentage of a property and pay off the remaining percentage through rent. You are usually able to take out a Shared Ownership mortgage on 10% and 75% of the property value. If you were to take out a mortgage on 65% of the property, you would be making mortgage payments on this amount and rent payments on the remaining 35%. Although you have two outgoing payments, sometimes it can work out cheaper to utilise Shared Ownership in London rather than take out a full mortgage or rent a property.
Since you are taking out a mortgage on a percentage of the property, you only must put down a deposit on this total. If the minimum deposit that you are required to put down is 5%, your deposit on a share of 10%-75% will be cheaper than a deposit on 100% of the property price.
If you have bad credit in London, you may need to consider alternatives to the Shared Ownership scheme. Unfortunately, most lenders will not accept applicants with bad credit. There are specialist lenders out there that offer products for bad credit applicants or those suffering from a low credit rating. Our mortgage advisors in London can explore these options with you and help you find an appropriate deal for your individual situation.
Shared Ownership is a mortgage in itself, and you will making regular monthly payments to pay it off. You will also have to make rental payments on the remaining share of the property to the housing association. You cannot own another property when utilising the Shared Ownership scheme, therefore, you must be a first time buyer in order to start your process. It is also worth knowing that you can only take out a Shared Ownership mortgage on a new build property. Any property that is purchased under the Shared Ownership scheme with be leasehold.
To take out a Shared Ownership mortgage in London, you will need to be at least 18 years of age and your annual household income must be less than £90,000. If you have a higher income, it is unlikely that you will be able to qualify for the scheme.
As a mortgage broker in London, we have helped many applicants looking to take a mortgage out using the Shared Ownership scheme. It is a huge help to those looking to get a foot onto the property ladder and are struggling to save for their initial deposit. We can also help with other Help to Buy mortgage schemes if you are interested in exploring other routes. One of our mortgage advisors in London will be more than happy to look through these with you to make sure that you are taking the best route for your personal and financial situation.
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During this appointment, your mortgage advisor will also review your income and expenditure to work out your mortgage affordability and eligibility for a Shared Ownership mortgage in London.
Our team will search for 1000 mortgage products to find the best one at your disposal.
We will help you obtain your mortgage agreement in principle, which is a great tool for backing up any new build offers you put down.
Once your purchase offer is accepted, we will submit your full mortgage application and evidence documents to the mortgage lender.
While this process is going on, your dedicated case manager will ensure that you are kept up to date through a formal mortgage offer, completion and beyond.
However, our service is more than that. Not only will we secure the best mortgage deal for you, but we will also recommend relevant insurance to protect you and your family.
We will also contact you when your mortgage deal ends to make sure you are on the best deal.
We have been helping home buyers with Shared Ownership mortgages for years now and we want to help you next. During your free mortgage appointment, we will be able to discuss the process and see whether you meet the scheme's requirements.
We have been working in the mortgage industry for over 20 years now and have helped many customers achieve their homebuying dreams. we love providing a great service! Customer service is always at the forefront of what we do here.
Our hard work and determination to find you the best deal available is reflected in our brilliant reviews; feel free to check some of them out!
Using our new booking system, you are now able to book your free mortgage appointment online. We have availability 7 days a week, so you can choose slots on a weekend if that appeals to you more.
We have a huge panel of lenders that offer both high street and specialist products. Our job is to search these lenders to try and find you the perfect mortgage product that matches your personal and financial situation.
Our mortgage advisors in London are highly experienced and know exactly what they are doing when it comes to finding you the right mortgage. Get in touch with our team at Londonmoneyman today and we will see how we can help.
When it comes to taking out a mortgage, there are only very specific circumstances where you will not have to put down a deposit. With Shared Ownership, you will need to put down a deposit and the minimum that you are required to put down can changed depending on a few factors.
One factor is what percentage of the property you are taking out a mortgage on. If you are taking a mortgage out on 50% of the property, you would usually expect to put down a deposit based on that amount. In this scenario, if the property is valued at £200,000, you own a 50% share and the minimum deposit required is 5% of that amount, you are looking at an approximate deposit amount of £20,000.
Another factor that can affect everyone, not just Shared Ownership applicants, is your credit score. In most cases, if you have a low credit score, you should expect to put down a higher deposit on your property.
In the industry, this is known as "staircasing". This is when a homeowner asks the local authority and building society if they can increase the share that they own.
If you only own 10% of the property initially, you should have the option, for example, to purchase a further 25%, should it be affordable in the future.
There may be a discussion at the point of purchase regarding whether or not you could have the chance to purchase in the future.
Because all Shared Ownership homes are leasehold, you will face ground and service fees on top of your regular mortgage payments and rent. You will also have to consider the costs that come with taking out a mortgage; costs could include property surveys, legal fees and any broker fees.
When selecting a property survey, even if you have to pay a little bit more, it could be worth upgrading to a more in-depth survey so that if there are any issues present with your potential future home, you know of them. Anything you don't look at could harm the property's value in a few years' time. A dedicated mortgage advisor in London will advise you on the best survey to take.
The Shared Ownership Scheme is limited to properties that are owned by housing associations or builders. In some cases, the property that you are looking at may have been built for a Shared Ownership mortgage and you would not be able to take a regular mortgage out on it.
Our job is to explain the whole of the process to you; how Shared Ownership works, why it may be beneficial to you and how we can get started!
Book a free mortgage appointment today and get started on the process of Shared Ownership in London.
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UK Moneyman Limited is Registered in England, No. 6789312 | Registered Address: 10 Consort Court, Hull, HU9 1PU.
Authorised and Regulated by the Financial Conduct Authority.
We are entered on the Financial Services Register No. 627742 at www.register.fca.org.uk
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Londonmoneyman.com & Londonmoneyman are trading styles of UK Moneyman Limited, which is authorised and regulated by the Financial Conduct Authority.
UK Moneyman Limited is Registered in England, No. 6789312 | Registered Address: 10 Consort Court, Hull, HU9 1PU.
Authorised and Regulated by the Financial Conduct Authority.
We are entered on the Financial Services Register No. 627742 at www.register.fca.org.uk
