Right to Buy Mortgage
What is the right to buy scheme?
The Right to Buy Scheme is a popular scheme often used by first time buyers, that is ran by the government and allows eligible tenants in England to purchase their property from the council for a slightly discounted purchase price.
So long as you have spent at least 3 years (this doesn’t always have to be continuous) renting from a local housing association and you are a secure tenant of a council owned property, you could find that you are eligible for a Right to Buy.
When you buy a property using a Right to Buy, the property will be valued at the full price that it would be on the market with the government discount applied before you make your purchase.
Where is the right to buy available?
Not all of the UK qualifies for the right to buy scheme and therefore a right to buy mortgage is not available in every part of the UK. The right to buy is currently available in England and Northern Ireland; the right to buy ended in 2016 and 2019 for Scotland and Wales, respectively.
What are the criteria to have a right to buy mortgage?
Time in the property
Not every council and housing association tenant qualifies under the right to buy. You need to have lived in the property for over three years, or you were living in a council home when the property transferred ownership to a new landlord. The time frame has decreased over time and in 2015 the eligibility changed from 5 years to 3 years.
Main residence
The home you are looking to get a right to buy mortgage with must be your main home. The property must also be self-contained and you must be a secure tenant. A self-contained property means that there are no shared facilities with another property. There cannot be any communal areas such as kitchens, bathrooms or living areas.
Other commitments
One of the main concerns that could affect your application is the debts you currently have. You should seek right to buy advice from your right to buy mortgage advisor before making any decisions. You must be free from legal problems such as possession orders and debts.
What other types of right to buy schemes are there?
There is also another scheme similar to the right to buy, which is the right to acquire. This is for assured tenants of housing association properties that were built with subsidies after 1997. The main difference between right to buy and right to acquire is the type of tenant. The right to acquire gives housing association tenants a discount on the home they live in.
Think carefully before securing debts against your home. Your home may be repossessed if you do not keep up repayment on your mortgage.