This type of house move can be complicated for people unfamiliar with the particular procedures involved. At TWM Solicitors, we have a team of property lawyers who have dealt with this type of transaction on numerous occasions and so are highly qualified to advise you on all of the steps involved.
We set out below some specific issues to think about in this type of property purchase:-
1. You will need to be formally approved by the housing association who will share ownership of the property with you. You should enquire directly with the housing association about this as soon as possible as otherwise, this can hold up exchange of contracts.
2. It is important that your mortgage offer is issued as soon as possible. The reason is that again, the housing association will need to approve the offer before you proceed to exchange of contracts and this can cause delays if the mortgage offer is not issued for a long period of time.
3. You should make clear to your mortgage broker or lender that you are buying a shared ownership property. Some lenders are not prepared to lend money on these types of properties or alternatively, it will affect the amount they are prepared to lend. The mortgage offer will also need to be changed for a shared ownership property so it is important this is made clear early on.
4. Stamp Duty Land Tax is a consideration for certain shared ownership transactions. In some circumstances, you can elect to pay tax on the full market value of the property rather than just on the amount you are actually paying for a share in the property. We can give you guidance on whether this is best for your circumstances.
If you would like specialist advice on a sale or purchase of a shared ownership property, please complete the form below and we will be able to provide you with a quote.