So today I want to talk about the Shared Ownership scheme.
Shared ownership is a great way of getting onto the property ladder when you might not have a big enough deposit or enough income to support a normal mortgage application.
The way shared ownership works is that you buy a share of the property, usually between 25-75% from the local housing association. You then pay rent to the housing association on the part you do not own.
For the part you wish to own you need to provide a minimum 5% deposit and the rest you take a mortgage for. For example, if a house is worth £100,000 and you were to buy a 50% share for £50,000 you would need a minimum deposit of £2,500 and the remaining £47,500 is then a mortgage.
There are some rules around the shared ownership scheme. Firstly, the property you are buying must be your only property and you must live in that property. You are not allowed to rent it out. Secondly, your household income must be less than £80,000 per year.
This scheme is open to First time buyers, previous homeowners who can no longer afford to buy a new home or existing shared ownership borrowers. The scheme is not available on all properties and must be part of the Shared Ownership scheme.
As you can see Shared Ownership can be a great way of getting onto the property ladder when you otherwise might not be able to.
If you wish to find out more please speak to your local mortgage adviser.