Can I use any mortgage lender?
Not all lenders will offer shared ownership mortgages. Of those that do, some, particularly the smaller building societies, may restrict their lending to local postcodes.
Even when a provider will offer mortgages for shared ownership properties, it can be confusing because there is huge variation in how much deposit different lenders require for different types of shared ownership property.
What exactly is a shared ownership mortgage and where do I find the ownership mortgages advertised?
A mortgage for shared ownership is one where the lender is happy to provide a mortgage on a share in a property, e.g. a 50% share, rather than on the entire home.
However, when it comes to mortgages, shared ownership can be restrictive because many lenders are not involved in the scheme and, of those that are, some, particularly the smaller building societies, may restrict their lending to local postcodes.
If you looking for a mortgage for shared ownership and want to find the most competitive shared ownership mortgage rates, you could consider seeking independent advice or alternatively, search our comparison site.
How much deposit will I need?
This can vary. If you use our shared ownership mortgage calculator (now going directly to our price comparison site) it is programmed with up to date lending policy from all the shared ownership providers and if the amount of deposit you enter is not sufficient it will show you the minimum required.
Generally, 5% is the minimum but it can be more than this depending on your circumstances and the type of shared ownership property you are buying. Certainly, the bigger the deposit, the better your mortgage rate is likely to be. 100% shared ownership mortgages are not generally available anymore.
What is staircasing?
If you already own a part buy part rent property, you can buy further shares in a process known as ‘staircasing’. Share to buy provides information on shared ownership staircasing including a staircase calculator that works out whether you might have enough equity to buy further shares, and also estimates the cost of staircasing mortgages.