Shared ownership

Shared ownership

Shared ownership lets your client buy a share in a property under a lease, usually from a housing association or local authority who will own the remaining share. Your client can choose to increase their share of the property over time, this is known as staircasing.

We offer specific shared ownership mortgages to meet the needs of these schemes.

Here are some things to know before you apply for a shared ownership mortgage for your client:

• You’ll need to produce the illustration at the DIP stage.
• We can lend up to 95% of the borrowers share of the property on houses (including new build).
• For flats (including new build) we can lend up to 85% of the share of the property.
• The maximum share of the property to be purchased is 75% of the full property value. This includes new build houses and flats.
• The minimum share of the property to be purchased is 10% of the full property value.
• On our affordability calculator, you’ll need to include the shared ownership rent as well as any maintenance or service charges. Enter the current monthly rental figure, as the calculator considers the likely increase in rent over the next 5 years.
• Capital repayment only.
• Purchase and remortgage available.
• We’ll only allow applications where a 6 April 2010 or later model lease is in place.
• We’ll allow applications from this list of registered providers on the Government website.
• Section 106 is permitted:
  • Restriction on the resale of the property only permitted where the scheme provider has an option to buy back the customer’s share at full market value for a period of no more than three months. We must then be able to staircase to 100% and sell the property on the open market at its full market value and no further restrictions may apply.
  • The mortgagee protection provisions in the lease must be unaffected by any restrictions.