A chance for homeownership: Right to Buy mortgage
If you have lived in a council house for more than 3 years, you might be eligible for a Right to Buy mortgage. The Right to Buy scheme helps council tenants to purchase their homes at an affordable price.
Navigating through the mortgage market can be overwhelming, with so much information out there. We’ll answer your frequently asked questions, help you understand the criteria, and get you started.
How can we help? My Mortgage Finder is a specialist mortgage broker that can help you find the best mortgages under the Right to Buy scheme
What is a Right to Buy mortgage?
Right to Buy is a UK Government-led initiative that allows you to buy your council or housing association home at a discounted price. It gives you the ability to purchase the home that you already know and love for up to 70% off the market value.
Every case is different, some council tenants might not be eligible for this initiative. If you live in a housing association home, you might be eligible for the Right to Acquire government scheme instead. The quick and easy way to find out which scheme best works for you is to take this handy quiz which will help you figure out the right one for you.
*Your Home (or property) may be repossessed if you do not keep up repayments on your mortgage or any other debts secured on it.
What you need to know about Right to Buy mortgages
Right to Buy mortgages have the same mortgage eligibility criteria as any other mortgage service. This includes your expenditure and income, as well as getting a credit check. However, there is one distinction – this being that it is exclusively a government initiative.
To be eligible for the scheme, you need:
- To have lived in a council or public sector landlord property for a minimum of 3 years.
- To have had no rent arrears or legal problems with your tenancy.
- The property to be your only or main home of residence.
- To be a secure tenant.
Check if you’re eligible for a Right to Buy mortgage with this quiz.
Learn more
Having bad credit can be a major obstacle when it comes to applying for a mortgage. For those who have struggled with debt in the past, it can seem like an impossible task to get approved for a loan. Fortunately, it is still possible to secure a Right to Buy mortgage even with bad credit issues.
My Mortgage Finder specialises in bad credit mortgages, as well as Right to Buy ones. We can offer personalised advice to help you get a mortgage on your council property. The first step is to speak to one of our mortgage advisers who can help to identify any areas where you might need to improve in order to increase your chances of being accepted.
Learn more
One big advantage of Right to Buy mortgages is that, in most cases, you won’t have to save for a deposit – instead, your deposit can be used. What this means is that if you’re buying a £150,000 property with a 50% discount of £75,000, for example, a lender might offer you a mortgage on the remaining £75,000 deposit-free and take your discount as a deposit.
Even if your lender does accept your discount as a deposit, it is still a good idea to have savings put aside when buying your council home. There remain mortgage fees, as well as survey and conveyancing costs, which you will need to budget for.
Learn more
What you need to know about Right to Buy mortgages
Right to Buy mortgages have the same mortgage eligibility criteria as any other mortgage service. This includes your expenditure and income, as well as getting a credit check. However, there is one distinction – this being that it is exclusively a government initiative.
To be eligible for the scheme, you need:
- To have lived in a council or public sector landlord property for a minimum of 3 years.
- To have had no rent arrears or legal problems with your tenancy.
- The property to be your only or main home of residence.
- To be a secure tenant.
Check if you’re eligible for a Right to Buy mortgage with this quiz.
Learn more
Having bad credit can be a major obstacle when it comes to applying for a mortgage. For those who have struggled with debt in the past, it can seem like an impossible task to get approved for a loan. Fortunately, it is still possible to secure a Right to Buy mortgage even with bad credit issues.
My Mortgage Finder specialises in bad credit mortgages, as well as Right to Buy ones. We can offer personalised advice to help you get a mortgage on your council property. The first step is to speak to one of our mortgage advisers who can help to identify any areas where you might need to improve in order to increase your chances of being accepted.
Learn more
One big advantage of Right to Buy mortgages is that, in most cases, you won’t have to save for a deposit – instead, your deposit can be used. What this means is that if you’re buying a £150,000 property with a 50% discount of £75,000, for example, a lender might offer you a mortgage on the remaining £75,000 deposit-free and take your discount as a deposit.
Even if your lender does accept your discount as a deposit, it is still a good idea to have savings put aside when buying your council home. There remain mortgage fees, as well as survey and conveyancing costs, which you will need to budget for.
Learn more
Navigating the application process
If you’re considering using the Right to Buy mortgage scheme to purchase your council home, navigating the application process might feel tricky.
Here is where to start:
FAQ: Right to Buy Mortgages
Getting a mortgage comes with extra costs outside of your monthly payments, these are often upfront one-off costs. The costs can include:
- Stamp duty – Which is a tax that you might have to pay when buying a residential property in England.
- Arrangement fees – Some lenders might charge you a fee for setting up your mortgage.
- Solicitor’s fees – Normally, you need a solicitor or licensed conveyancer to carry out all the legal work associated with buying your home.
- Survey fees – Money paid for an inspection of the building to determine its condition and value.
- Land Registry fees – A fee for registering the land in your name.
Under the Right to Buy scheme, the level of discount on your property is between 35% to 70% of the property value.
If you live in a house, you’re eligible for a 35% discount after 3 years of living in the property. After 5 years, this increases each extra year by 1% until it reaches a maximum of 70%.
If you live in a flat, you are eligible for a 50% discount after 3 years have passed. Much like living in a house, after five years, it increases by 2% for each extra year with the same cut-off point of 70%.
Do you have more mortgage-related questions? Take a look at our mortgage frequently asked questions!
A public sector landlord is an organisation that owns and manages housing for members of the public, such as your local council, housing association, or the NHS trust.
These organisations provide rental accommodation to people who have difficulty accessing the private rental market. With a public sector landlord, tenants can access longer-term tenancies or rent at a discounted rate, depending on their circumstances.
Council properties that are eligible for Right to Buy mortgages are an example of a public sector landlord-owned home.
Find the path to homeownership with us
At My Mortgage Finder, we believe that everyone should have access to homeownership regardless of their situation. Whether you have a poor credit history or are a first-time buyer, we are here to help.
We’ll help you with the mortgage application process as well as offer advice unique to you. We take into account your life when we find mortgages for you, such as the mortgage repayments you can afford, the amount of deposit that you have, your credit history, and the type of property you have.
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