Shared ownership mortgage

[Kjs1234]

Hello, I’m looking for info on getting a shared ownership mortgage if anyone can help me?

I’m recently separated from my husband with a 3 year old together. We have sold our house and split the equity equally which I plan to use to buy again. I’m currently renting (working full time) and receiving UC which includes Housing allowance.

Shared ownership looks like a good option, but there seems to be mixed information about the housing element of UC. Reading online it seems that I would still be entitled to receive the UC housing allowance on the rented portion with shared ownership, but from what I can gather mortgage companies won’t take this into account at all for affordability.

Does anyone have any recent experience of applying for shared ownership with UC including housing allowance?

I have no idea about this but dc is currently going through the process (has got to the sign off bit). To get to the sign off bit has had to be assessed and they were very helpful with all the questions dc had, could you try talking to someone like this www.metrofinance.co.uk (your not committing to them by asking questions).
Also we got information from www.moneysavingexpert.com/mortgages/shared-ownership-scheme here.

Yeah you’re right OP, so you can in theory continue receiving housing benefit for the rented part of a shared ownership home. The problem you may find though is that lenders can be funny about accepting UC as income or counting it towards affordability. Some do, depending on the circumstances, but it may be that you have to get your mortgage just based off of your full time working wage discounting UC

Are you sure you can’t afford to buy somewhere that’s not shared ownership? Even if it’s tiny or not in the perfect location. I’ve heard a lot of people talking about the management fees and saying it can be hard to staircase to buy a larger percentage of the property.

I am a shared ownership mortgage broker

There are two lenders who will use the housing benefit element provided it can be evidenced it will be ongoing. We use the entitled to calculator to evidence it

Thanks for the responses 😊

@Umbrellamaybeneeded I’ll have a look into the metro finance link, hopefully they will be able to advise on what the lenders will take into account.

@Mrsttcno1 thats what I gathered from speaking to a couple of mortgage advisors, but was hopeful that others might have experience of it being counted. It seems a bit of a backward system when this is supposed to be ‘affordable housing’!

@SummerTimeIsTheBest I am looking into that option as well but there’s hardly anything within my budget. I’ve been told by estate agents that more is likely to come to market in a month or so after the school holidays so hopefully there might be more options. I’m not necessarily looking for a ‘forever home’ but I’ve already moved once so I do really want to find somewhere that I can stay in for a good few years and be settled 🤞 I know shared ownership isn’t really a great deal compared to owning outright but just seems like a good medium term option. I will definitely keep looking!

@forgotmyusername1 thats great to know thank you! How would it be evidenced as ongoing? I assume it would be best to go through a shared ownership specialist if there’s only a couple of lenders that do this?

I get clients to fill out the entitled to.com calculator as if they are already living in the property and submit that as evidence as to what the universal credit will be post completion.

@forgotmyusername1 thank you so much for the information that’s really helpful. I’m not too familiar with the process as I’ve only just sent in an application, am I able to contact any mortgage advisor I like or do I need to go through the HA specified one?

Usually the Financial assessment has to be done with the one the housing association uses (I do them for Clarion and Hyde on some of their sites) but the mortgage can be done by any broker

Hi
We're in the same position. HA broker has said we cannot count housing benefit towards mortgage amount we need. Spoke to Nationwide and we got a MIP using all UC including housing part. I'm now worried thats not acceptable so waiting for mortgage advisor to confirm if it will be accepted. What lenders do take into consideration housing benefit? We would still be entitled as we are on low income. Really losing the faith in all this process its becoming so stressful. We have saved a deposit and now feel we've hit a brick wall. Thanks 👍

@Emma145983 Sorry to hear you’re in the same position. I think the whole thing depends on which broker the HA uses and what their criteria is. It seems very unfair as this is supposed to be a nationwide scheme and yet the different housing associations can set their own rules.

Have you passed the HA brokers assessment without the housing element included? I think unfortunately it seems that you need to get through the first hurdle of the assessment without including the housing benefit, even though you know you will get it! It must make the scheme unaffordable for so many people who should be eligible 🙁

Passed HA sign off, finance checks done including HA as I was under the impression that mortgage would be given including full UC money. Went back to mortgage provider yesterday and said signed off. They then went back through figures and that's when HA came up as it makes up 50% of our claim. When I obtained the MIP I did make them aware of this and that it would continue to be paid. However because when I rang back yesterday and I spoke to a different advisor at the same company they say it might not be possible to include it. Their checking with the underwriters. We probably won't find out till mid next week. After reading online it doesn't look likely they will include it. I am applying for mortgage independently not using a broker.
How far are you with your application?

@Emma145983 Sorry for the delayed response. How did it go with the mortgage underwriters? Sounds like you were nearing the end of the process so I hope you’ve been able to proceed with everything.

I’m still in the application process with the housing association so I’m crossing fingers that all goes ok this time. I applied previously and didn’t get past the financial checks because of my car loan and childcare costs but circumstances have changed now so I’m really hoping that I’ll get accepted.

Any advice on the whole process is gratefully received!

Hi, was wondering what lenders use entitled to as evidence. Im in same boat. Can you help?

Hi could please tell us who are the lenders

Hi coould you give your details need a morgage advaser

@forgotmyusername1 I know this is an old post so you may not see this.

Hoping you might be able to help with some financial assessment questions. We have a lot of disposable income, but some older bad debt, two CCJs more than 3 years old and DH has missed payments, also more than 3 years old. Would they decline us from the start? Or allow us to continue based on affordability now and us getting a mortgage?

You would be allowed to continue provided you can get a mortgage. If adverse is over 3 years old and settled there are some high street options

Update- we were accepted for our mortgage using HA as part of our monthly income. Nationwide are one of the only lenders that include HA with borrowing.
However we had to have no debts whatsoever everything paid off before applying and no bad credit for more than 3 years which we didn't have nothing in red on credit file.
Every case is different tho and depends ok circumstances and how much income you are bringing in and borrowing.
We were 4 months from applying for the house and viewing to moving in. Most stressful 4 months of my life and I am never doing it again!
Good luck everyone

Thank you!

Pleased it all worked out for you!