Right To Buy Mortgages
Right to buy mortgages could be just what you need to be able to buy your own home. Although many people have heard of right to buy, very few people understand exactly how right to buy works. Here's an overview of right to buy mortgages.
Since Margaret Thatcher first started the right to buy system to help more people become homeowners, more than 1.5 million people have already used the scheme. It is available for council tenants, who have the right to buy the home that they are renting as long as they meet certain requirements. Not all council tenants have the right to buy, though. If your property is especially suitable for the elderly or disabled, then this will be exempt from the scheme. And if you get a council property because you are working for the council or other relevant employer, then you won't have the right to buy that property.
Right To Buy Discounts
Essentially, the right to buy scheme allows tenants to buy the property they are renting from the local council at a considerable discount to the market value. The discount they receive depends on where the home is, how long they have rented it, what type of tenancy they have had and whether the property is a house or flat. Depending on your circumstances, the discount can be between 32 per cent and 70 per cent of the property value, with a maximum discount amount of between £16,000 and £32,000. Information on the discount that applies in your area is available from the Communities and Local Government website.
Charitable Association Right To Buy
Right to buy is also available from non charitable housing associations or housing action trusts. In all cases, the qualifying period for right to buy is between two and five years. Before you can get a mortgage for a right to buy property, you need to find out whether this scheme is available. Send the right form to your landlord, and you will soon know if you have the right to buy, the property value and the discount you might get. Once you decide to go ahead with the process, it's important to get a right to buy mortgage in place quickly.
Suitable Right To Buy Lenders & Deals
To do that, you'll need to find a lender who offers right to buy. Not all lenders do, so it's worth searching on the internet or finding a broker to do the hard work for you. Getting a suitable right to buy mortgage will affect the payments you need to make every month, so it's important to get this right. When choosing a right to buy mortgage, the criteria are similar to other mortgages. Once you have found a number of deals, it's worth comparing them in terms of interest rate, repayment method, fees and incentives to see which one is the most cost effective.
If you're not sure that you can do this effectively, then it may be worth using a broker with experience of right to buy mortgages. The broker will have an overview of available deals, and they will be able to suggest the ones that are most appropriate for your circumstances.