Right to Buy Mortgages

Right to Buy is a government scheme designed to help existing council tenants buy their current homes at a large discount. There are many Right to Buy mortgage lenders out there who will help you become a homeowner using this scheme if you and your property meet their criteria. If you’re not sure whether you qualify, or you need more information just give us a call – our advice is always free.

Right to Acquire is an extension of the government Right to Buy mortgage scheme where housing association tenants can also buy their current homes at a discount. The eligibility and criteria for applicants and properties is slightly different to Right to Buy, so please do call us if you want to assess your situation and receive our fee free advice.

In order to qualify for the Right to Buy mortgage scheme, you must have been a council or housing association tenant for at least three years (although not always continuously), live in the property as your only or main home, not live in sheltered housing for the elderly or disabled, not suffer from any serious debt problems, not have any outstanding possession orders against you, and the home must also not be due to be demolished.

The Right to Buy mortgage scheme currently only applies to tenants in England.

The discount you receive on the Right to Buy mortgage scheme will be calculated based on the market valuation of your home. This can vary from county to county, the length of time you’ve been a council tenant, and also whether your home is a house or a flat.

After three years’ council tenancy (including 12 months in your present home) you are eligible for a 35% discount on a house and a 50% discount on a flat. These discounts can then increase up to a maximum 70% value (currently £84,200, or £112,300 in London).

In order to receive a mortgage using the Right to Buy scheme, you will need all of the usual documentation including proof of identity, proof of address and financial statements, but you will also be required to complete a special Right to Buy application form. Before completing this form, we highly recommend seek good advice to make sure you know what you can afford. Please don’t hesitate to call one of our advisors to discuss your situation further. Our advice is always free.

A home is a valuable asset that can give you and your family an investment for the future. It also gives you the freedom to make the changes you want in your home and the money you pay in mortgage repayments each month goes directly into the value of the property you own rather than into your landlord’s pocket. Despite the benefits however, a property purchase is a decision that shouldn’t be taken lightly as it has responsibilities and financial commitments that you wouldn’t otherwise have as a tenant.

Owning any home has its risks. You need to make your mortgage repayments each month or risk your home being repossessed, as well as covering maintenance and repair costs, ensuring you have adequate insurance and protection and you may also need to help with the upkeep of residence communal areas.

Buying a council house, however, does have a few extra risks too. Council houses may be at risk of demolition, not to mention their value isn’t guaranteed to increase which could put you out of pocket. As a home owner, you will also no longer receive any housing benefit payments. If you want to know more about the relevant risks to your personal situation, our advisors can offer fee free advice. Just give us a call!

On the Right to Buy mortgage scheme you can’t just purchase your home with a large discount and immediately sell it to make a profit. If you sell within five years you will have to pay back all or some of the discount, and even if you sell your home within ten years you will be required to offer it to your old landlord or another social landlord at market price first before putting it on the open market. Before buying your council home, think carefully about how long you may want to stay there as it could make buying your next home slower and more expensive.

Different Right to Buy mortgage lenders will have slightly different criteria in the amount that they will lend, but it can be possible to use your Right to Buy discount as your entire deposit. You will still need some savings for the process however, as there will be survey and legal fees that could cost at least a few thousand pounds. We are very happy to offer guidance on your specific property and situation so you know how much money you may need. Don’t hesitate to get in touch! Our advice is always free.

If you feel Right to Buy isn’t right for you, there are other government schemes available such as Help to Buy or shared ownership. Our First-Time Buyer guide may have some useful information for you, otherwise please do give us a call to talk about your situation further. We are always here to help find the mortgage that is right for you.