Shared Ownership Mortgages
A shared-ownership mortgage is a government scheme to help people to get onto the property ladder who otherwise might struggle due to income and savings. The borrower buys between 25% and 75% of a property from a housing association or house builder, so the mortgage loan is smaller, with a lower deposit.
You part own and part rent the property, paying lower mortgage repayments each month. There is still the monthly ‘rent’ to take into consideration but over time you can buy off the `rented` part of the property if desired.
One difference between shared ownership and a standard mortgage is that shared ownership mortgages are only available via selected lenders, so your options will be more limited. Also check with the housing association or other authorised body who you share the ownership with, to understand their rules to see if you are eligible.
A big difference with a shared ownership mortgage is that the deposit is only for your part – therefore, in a £200,000 property where you want a 50% stake, a 10% deposit would only be £10,000. If you were buying the whole house it would be twice this amount at £20,000.
To qualify for a shared ownership mortgage, you will be tested on:
• maximum incomes,
• you should be a first time buyer or previous homeowner who cannot afford to buy now,
• or you are renting from a housing association or the council, or have a long term disability.
As with any mortgage deal, the most suitable one for you will depend entirely on your individual circumstances. At Aspire Financial Services, we can help you find the right shared ownership remortgage deal from those available to suit your needs. The first consultation is free and comes with no obligation – contact one of our team today.