Mortgage Shared Ownership Frequently Asked Questions
- Is everyone eligible for shared ownership?
No. shared ownership is aimed at (but not exclusively to) first time buyers unable to buy a suitable home in any other way. The maximum income thresholds are £66,000 per annum for one or two bedroom homes and no more than £80,000 per annum for 3 bed homes.
- Can I choose what share in the property I buy?
No. It is government policy that shared ownership purchasers buy the largest share in the property they can reasonable afford and sustain. There is a robust assessment process to work this out. Censeo will be able to advise you on the likely share you will be asked to purchase.
- Will I need a deposit?
Yes. You will need a deposit of at least 5% of the share value you are purchasing. In addition we would recommend a further £3,000-£3,500 for associated costs such as legal fees and mortgage fees.
- Does every lender support Shared Ownership?
No. Shared ownership is specialist lending which is why your Housing Provider will recommend you speak to an expert such as Censeo to arrange your mortgage finance.
- Once I take a mortgage can I switch mortgage provider (Remortgage)
Yes, there are lenders that accept remortgages on Shared Ownership terms. Censeo will be able to assist with this.
- Can I consolidate debts into a shared ownership mortgage?
No. Borrowing against your share for debt consolidation is not allowed under the terms of the scheme.
- I have current credit problems can I purchase Shared Ownership?
No. In addition if you have suffered any defaults, CCJs or Bankruptcy’s within the last 3 years it is unlikely we will be assist you in obtaining a mortgage
- Can I purchase additional shares?
Yes. Through a process called staircasing. This allows shared owners to increase their stake in the property. The minimum a person can staircase by is 10%. Censeo can assist you finance the purchase of additional shares in your home.
- Can I arrange a sharia mortgage for a shared ownership purchase?
No. At present Sharia mortgages are not compatible with shared ownership.
- Can I arrange an interest only mortgage for a shared ownership purchase?
No. Any mortgage for shared ownership must be arranged on a capital repayment basis. The Housing association will review the mortgage offer to confirm the terms are acceptable to them.
- I am on a visa can I purchase a shared ownership property?
Yes. However you will need a larger deposit. The length of time left on your visa will be critical to lenders agreeing a mortgage.
- What information will I need to secure a mortgage
Typically you will need the following documents to secure a mortgage:
- Your payslips for the last 3 months. (Please bring 3 months’ worth even if you are paid weekly) or
- If you are self-employed, your audited accounts for the last two years from a certified or chartered accountant or the last 2 years tax assessments from the inland revenue
- Your passport
- Last 3 months bank statements for all applicants (original)
- Your latest p60 (original)
- A recent rent statement or copy of your rent book
- Proof of residency for all addresses you have lived at for the past three years. This can be in the form of utility bills or council tax documentation or bank statements. If you are unable to provide any of this for any addresses, a letter from your bank confirming that correspondence was sent to you at this address will do
- Visa details if you are not a UK national
- Proof of savings
Please note this list is not exhaustive and the lender reserves the right to ask for any information n they deem necessary to approve your mortgage application.
