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Ownhome
What is it?
Ownhome is a Government backed low cost, homeownership programme. It allows you to receive an equity loan towards the cost of purchasing a home on the Open Market.
It is aimed at helping social tenants, key workers and others who cannot afford to buy a suitable home in the area where they live or work.
Who can apply for Ownhome?
Eligibilty for Ownhome is targeted at groups such as local residents and key workers. Most applicants are first time buyers, however, we can also help a number of people who have previously owned property but are now unable to buy without assistance, for example in the case of a relationship breakdown.
The Government have prioritised the following groups for assistance under Ownhome
- Social rented tenants & Housing association tenants
- Local residents prioritised on the Local Authority housing waiting list
- Public sector key workers
- Other priority groups recommended by the Regional Housing Board
How does it work?
After being accepted you would simply choose a suitable property (usually through an estate agent) on the open market.
You then receive up to 40% of the value of the property in an equity loan from Places for People. Ownhome is provided by a partnership between Places for People and the Co-Operative Bank.
You will pay nothing for the first five years on the equity loan. After these five years a low rate would be paid on the sum – starting at a fixed rate of 1.75% interest per year for the next five years, and then increasing to 3.75% interest per year from year eleven.
The remainder would be funded through a conventional mortgage with The Co-operative Bank. There will be no premium or extra charges on the mortgage, and customers can choose from a range of competitive deals including fixed rate and tracker options.
How much loan is available?
This will depend on your household income, family size and property values in the area where you live or work.
Do I have to make monthly repayments?
You must maintain your home and pay all bills including amenities, council tax and buildings insurance. You are responsible for mortgage repayments and the 1.75% from year 6 (increasing to 3.75% in year 11) charge on the equity loan.
Who qualifies as a key worker?
Key workers are defined by the Government. To clarify your eligibility, visit the Housing Corporation website www.housingcorp.gov.uk.
Can I redeem part of my equity loan?
You are entitled to redeem all or part of your equity loan any time after one year of owning you home. Your home will be valued by an independent surveyor who is registered with the Royal Institute of Chartered Surveyors (RICS). If you decide to proceed it will be at a price based on the current valuation. The monthly charge you pay will be reduced proportionately – to zero in the event that you redeem your loan completely.
Do I need to have any savings or deposit?
Your equity loan cannot be used as a deposit or towards your purchase costs. We estimate you will need around £4,500 to cover legal fees, mortgage fees, stamp duty and other costs associated with buying and moving.
When I sell my home, how much do I have to pay back?
The loan you receive through the Ownhome scheme represents a percentage of the purchase value of your property. When you sell you will repay the same percentage based on the property value at time of sale.
If I need to move home, do I need to repay the loan?
Yes.
Your questions answered
Click on the link below to find out more information about Ownhome.
How do I apply for Ownhome?
You need to complete an application by clicking here.
