What is a Shared Equity Mortgage?
Shared Equity is the basis of the Government’s Open Market HomeBuy Scheme.
Under the Open Market HomeBuy shared equity scheme you buy 75% of a property, taking a mortgage from a select number of lenders - the remaining 25% is provided via equity loans from the mortgage lender and the Government. You can choose a property being offered on the open market subject to Homebuy Agent’s approval of the property.
After 5 years, interest (at a reduced rate) is payable on the lender’s equity loan – both equity loans are fully repayable when you sell the property.
The Government also offers a 17.5% Government Equity Loan which purchasers will be able to use in conjunction with a Mortgage.
Who can apply?
- Existing council tenants
- Existing housing association tenants
- People on council housing waiting lists
- Key workers
- Some other priority first time buyers
The HomeBuy Agent will have a Panel of Independent Financial Advisers such as CTAB Mortgage Desk. CTAB are proving to be one of the best sources of not only Mortgage Products but unrivalled personal service. CTAB have no advertising costs and no Sales Force – though they are considering Joint Ventures on the same basis as their current practice. Their website is www.sharedownershipmortgages.org.uk
You will find all the technical jargon you will need on their site.