This is a great scheme for those with very little deposit available as you only require a minimum 5% deposit for the actual share you are looking to purchase, however there is a lot more red tape to work through and far less lenders available for borrowers with credit issues.
This makes the properties more difficult to purchase than those via a Help to Buy scheme. It’s always worth checking though as from time to time a few lenders will offer up to 100% mortgages in this situation.
Currently if you are unable to go to a high street lender there are very few specialist lenders that offer Shared Ownership Mortgages. In addition, things become even more difficult if you have credit issues, defaults or CCJ’s or any new adverse claims recorded against you within the past 24 months.
The main issue is not the availability of lenders as there are lenders that will consider your application. However due to the higher interest rates and typically the higher lender arrangement fees, even if you were to pass the HCA affordability calculator, the associations themselves will not accept your application to purchase one of their properties due to their own criteria around the maximum interest rate and lenders fees.
Some associations will also go as far as to name lenders they will not accept applications from.
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