shared ownership scheme

J35

hey i've been researching the shared ownership scheme alot for the past few weeks about if you can actually do it with just solely relying on benefits as your income, the info i find always leads me to a crossroad 'yes you can' 'no you can't' so i just give up.

a little about me is that i don't really want to privately rent as i suffer with MH issues ( i won't go into it here but i have my reasons)  

i've found that UC CAN pay the rent side of it, i've found that some websites state you CAN apply if your on benefits. some websites say you CAN'T apply if your on benefits, you CAN get a SMI mortgage after 8 months of paying your mortgage side of it, so it all just leaves me confused so i would like to ask a few questions here 

1. can you get a shared ownership home if your on benefits?

2. is the shared ownership scheme the best way to get a home if you rely on benefits being your main income? ( as it's impossible for people on benefits to get a normal mortgage as the government won't help you with payments) 

3. is there anybody in this community that's done the shared ownership scheme relying on benefits and was successful getting a home? / has any experience with the shared ownership scheme?

i would love to hear from you thanks.    

    

janer1967

Hi I dont really have any knowledge of the shared ownership scheme but maybe you can get dome info from CAB or Shelter, or speak to  a mortgage broker

woodbine

You could also speak to a house builder who operates shared ownership schemes, but do remember that SMI is now a loan not a benefit (as such) and has to be repaid at some point even if it's sometime in the future as @janer1967 advises CAB or shelter are good places to get advice on this.

J35

@janer1967 @woodbine thanks for the info i appreciate it 

poppy123456

Hi,

When claiming UC you need to wait 9 consecutive months with zero earnings before you can apply for the SMI. As woodbine has correctly advised, it's just a loan.

To be honest, i wouldn't want to apply for any mortgage while claiming benefits. It's not just the repayments, it's everything else that goes with it.

J35

@poppy123456 hi thanks for your info i'm just putting research in on what's best for me, i'm currently writing a pro/con list and your insight could be useful. before i ask you a question, can i ask if you know how the shared ownership scheme works and what its all about?  

poppy123456

All i know is that you'll need a mortgage for the percentgage you're buying and you pay rent on the remainder. It may not even be possible to get a mortgage when you're claiming benefits. You really do need expert advice regarding this.

J35

@poppy123456 its ok i'll leave the questions for the experts, i thought you might of had knowledge on this situation because you commented. i was just wondering why you said ''To be honest, i wouldn't want to apply for any mortgage while claiming benefits. It's not just the repayments, it's everything else that goes with it'' i could of added your input to my pro/con list but it's all good.

poppy123456

I meant the expense if any repairs are needed. You will also need a deposit of between 5-10% for the mortgage, are you able to get that?

J35

ah ok yes i know all about that, and these things shouldn't be a problem (hopefully) i've had a look at that shelter website that the other users linked and got some good info from it (including repairs) but i realized it's probably better to reach out to CAB/Shelter and explain my situation to get the best advice.

woodbine

I will add to what I said, I have to agree that you will find it difficult if not impossible to get a mortgage whilst on benefits especially so now that lenders are tightening up on who they lend to.

J35

@woodbine i agree with you any other mortgage will probably be impossible to obtain, this is why i'm trying to research shared ownership as you can buy shares of your home between 25% - 75% (instead of 100% like normal mortgages) so say i went with the minimum 25% will lenders be more willing for someone in my position see what i'm saying? but like everybody said it's best to get some expert advice on this. i was just wondering if anybody on here went down this route and could share their story  

Adrian_Scope

Hi @J35. Some lenders do take benefit income into consideration and it can be possible to obtain a mortgage but it is difficult. We've some information and further reading about this on our website here: Mortgage affordability and benefits

As you say with shared ownership you can get help with the rent side which is helpful. 

Best of luck with your search. 

kiwi_1706

I looked into this a little while ago... and my memory is not so good... but I do remember that I could not find any shared ownership schemes for less than 75% of the property value... and I wouldn't have been eligible anyway, because the shared ownership scheme used a particular mortgage provider who would not approve any applications from anyone who had had adverse credit. They wouldn't allow the application to be just in my husband's name either, it would have had to have been a joint application... another dead end! Maybe those things aren't an issue for you.. Good luck!

J35

@kiwi_1706 thanks for your info i'm just putting the research in before i decide to do anything at this point. but due to covid right now it's probably the worse time to look into any type of mortgage, so its on hold for now 

Chloe_Scope

If we can do anything else then please let us know @J35! I imagine it's a stressful time.