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Shared Ownership Mortgages

 
 
 
 

Do you need help getting on the property ladder for the first time?

A shared ownership mortgage could be the answer you’ve been seeking.

With this solution you will only buy a portion of the property, so the amount of deposit needed may be lower. It therefore helps first time buyers who are struggling to save up enough for a deposit.

We’ve helped lots of customers access these products, allowing them to achieve their goal of getting on the property ladder.

See what options are available to you by calling 0800 032 4646 or by sending us an email!

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What is a shared ownership mortgage?

 
 
 
 

A shared ownership mortgage is a solution that allows you to buy a percentage of a property.  This means that rather than buying the entire house, you will only have a certain share in the property. The remaining share will be owned by a landlord.

When it comes to repayments, you will pay for a mortgage on your share of the property and will pay rent on the remaining share.

We have access to a diverse selection of products through our fantastic panel of specialist lenders.

Our solutions have a range of features and criteria, meaning that we can find a product that is personalised to your specific plans. So, if you’re thinking about getting one of these options, our experts can help you.

What is the shared ownership scheme?

 
 
 
 

The shared ownership scheme was introduced by the government in the 1980s, with the aim of helping first time buyers get on the property ladder.

With this scheme, you will only buy part of the property and will pay rent on the rest. It is therefore commonly called ‘part rent, part buy’.

When you take out any mortgage you will put a deposit down on the property. By using this scheme, the amount of deposit needed to purchase a home would be lower as you are only getting a mortgage on the share you have bought.

Therefore, engaging in this scheme can be really useful if you are struggling to save up enough money for a deposit and in many instances it may help you get a property that you would have otherwise been unable to afford.

Can you eventually buy a shared ownership property?

 
 
 
 

It is possible to get full possession of your shared ownership house. During the course of your agreement you can own extra shares in the property through a process known as staircasing.

Buying more shares in your property can be hugely beneficial, as it can lower the rental payments you have to make. Eventually, you will come to a point where you own the entire property and no longer have to make any rent payments.  

Additionally, you have much more flexibility and control over the property, as you have a larger share in the house. This means you may have more freedom to make changes to the property, allowing you to get the house in the position you desire.

Therefore, it is definitely possible to become the sole owner of the property through this scheme, so it could be a worthwhile initiative to consider.

What are the pros and cons of shared ownership mortgages?

 
 
 
 

As with any finance solution, there are a range of different benefits and disadvantages that could be worth considering.

Some of the pros may include:

  • Using this scheme gives you an alternative way to get on the property ladder. So, if you are struggling to buy a property through the conventional buying process, this scheme may be able to help you.
  • Without this scheme, many people may struggle to save up enough money for a deposit and therefore may be unable to afford to buy a home. Therefore, it helps you to get a property you may have otherwise been unable to afford.
  • It may mean that the amount of deposit you have to pay is lower, as you are only taking out a mortgage on the share of the property you have bought rather than the whole house.
  • You may be able to make cosmetic improvements to the property, as you own a share of the house.  This is not always a possibility when you rent.

The cons of this scheme can include:

  • The scheme isn’t available on every property, so your choices may be a bit more limited. It’s important that you research carefully to ensure that you find properties under the scheme.
  • There may be limitations on the home improvements you can make, particularly if they involve large structural changes. Your landlord (who has shares in the house) also has a say in what happens to the property, so you may need to consult them and get permission before making changes.
  • You don’t own the property entirely to yourself, which can restrict the amount of flexibility you have when it comes to making decisions about the property.
  • Getting full ownership of the property can be expensive when you factor in all the other costs including valuations, stamp duty tax and legal fees.
  • Although you will be sharing the property with your landlord you will be entirely responsible for maintaining the house, which can bring additional charges. Along with your mortgage and rental payments, this can quickly mount up.

When you are deciding whether this option is right for you, it’s important that you weigh up the advantages and disadvantages first. Our friendly team are always more than happy to give you a steer on what options are best for you.

How do I apply for a shared ownership mortgage?

 
 
 
 

The process to apply is similar to other finance options, so it’s very quick and simple. Use our steps below to guide you through the process:

1. Call or email our skilled advisors to discover our range of solutions and enquire.

2. Highlight your needs to our experts, so they can match you with the best possible solution we have available for your situation.

3. Our team will go through the product details with you and will give you the time you need to decide whether it’s right for you. If you choose to proceed, our advisors will handle the rest.

At each step of the process our advisors will be available to support you, ensuring that you make an accurate and informed decision based on your own individual circumstances.

Frequently Asked Questions - Shared ownership mortgages

 
 
 
 

Where can you get a part buy part rent mortgage?

Getting one of these solutions can be achieved by going to a bank, lender or by reaching out to a shared ownership mortgage broker.

If you’re confident about picking a product on your own, then you may be happy to go directly to a lender or bank who has a suitable solution for you.

However, if you’re a bit unsure about the products and feel you could benefit from having more guidance, speaking with a broker could be the appropriate option. 

Can you get a shared ownership mortgage if you have bad credit?

Yes, it is still possible to get these products with bad credit. However, the options available may be more limited, so the product you get may not be as competitive as other solutions in the market.

To add to this, it could be more challenging to get approved with a high street lender. The qualifying criteria high street lenders have can be much stricter, so there may have restrictions on lending to people with bad credit. 

Despite this, there are lots of specialist mortgage brokers and lenders out there who can support customers in these situations, including our friendly team of experts.

Am I eligible for a part buy part rent mortgage?

In terms of eligibility, you may need to satisfy some basic criteria first. It’s important to be aware that this may vary depending on the provider you go with, so it’s good practice to look into these before you settle on a solution.

Qualifying criteria may include:

  • Be aged over 18 years old
  • Make sure that the property you’re wanting to buy is under the shared ownership scheme
  • Ensure that your income is lower than £80,000 or £90,0000 for those living in London

How can I get a quote for a shared ownership mortgage?

Getting a quote for one of these solutions is easy, it’s just a case of calling or emailing our team.

Simply tell our advisors what your requirements are and we will search our range of products to find a solution that matches.

How are shared ownership mortgages different from standard mortgages?

These solutions differ from traditional mortgages in that you only buy a certain amount of the property, rather than the whole house.

Due to this, your payments will be a combination of a mortgage to your bank or lender and rent to your landlord.

Are there many shared ownership lenders?

There are a range of different lenders available who offer these products, so there are a variety of options open to you.

If you have any difficult circumstances or are unsure on what solution is best for you, it may be worth speaking to a specialist mortgage broker. Brokers have access to lots of different products, so even if one solution doesn’t fit there is likely to be other options that could work for you.

Where can you find shared ownership houses?

Property portals are useful locations to find houses that are up for sale or rent. These sites also show properties that are included within this government buying scheme.

Finding houses to part buy part rent can therefore be much simpler than what you might think.

Useful guides and blogs

 
 
 
 
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