Shared Ownership

Just wondering if somebody could give me some much needed information on shared ownership?

I have been told the basic outline is that you choose a house and pay for a min of 40% of it then pay the mortgage on that % then pay the council rent for the left over amount? can somebody let me know the figure of rent paid in respect to the council and what % do you have to give them if deciding to sell the home?

Im just confused by the lack of and different information posted everywhere. I will be applying to South dublin co Council.

Cheers

Mat

I am sure this won't be what you want to hear but I explored shared housing with south dublin last year. After a lot of struggling and being completely confused by conflicting information I was finally put through to woman who told me than while technically shared ownership was available in actual fact it was no longer a viable option. They said todays property costs meant that people on relatively low wages (who shared ownership was designed for) cannot afford to pay the mortgaged part of a property along with the other rental part from the council. I was told that no-one had done shared ownership in SDCC in over a year. As ever I got the impression that information was, at best, a bit vague and perhaps not set in stone but that was what I was told but she was at least trying to be helpful. I can't think of the name of the person I spoke to but think I have her first name written down somewhere and will check for you.

mat9486 said:

Just wondering if somebody could give me some much needed information on shared ownership?

I have been told the basic outline is that you choose a house and pay for a min of 40% of it then pay the mortgage on that % then pay the council rent for the left over amount? can somebody let me know the figure of rent paid in respect to the council and what % do you have to give them if deciding to sell the home?

Im just confused by the lack of and different information posted everywhere. I will be applying to South dublin co Council.

Cheers

Mat

Click to expand...

Its actually quite straight forward. You borrow say 200,000 from the council.
Then the amount borrowed is split into two half’s, generally split down the middle, hence the term 50/50.
You can then think of one half as a regular mortgage which you pay back every month as you would with any mortgage.
You can think of the other half as an interest only mortgage where you pay back the interest only on the amount. This is also know as the rent on the other half. Its not really rent you are just basically pay interest on this portion and thus you are never actually paying off the second part of the loan. You can reduce this part of the loan every year or so.

Calculations:

House cost 200,000

Mortgage portion (50%) 100,000 over 30 years at 5% would mean you would be paying back about 530 euro.

Council portion (50%) interest on 100,000 over 30 years at 5% would men you would be paying back about 260 euro in interest (or rent as they call it).

Total payment would be:

530 + 260 = 790.

Of course at the end of the 30 years you would still owe the council 100,000.

Most simplest way to think of a shared ownership loan is part repayment mortgage part I/O mortgage.

Hi, I just wanted to ask somemore on shared ownership.

Do you have to pay a deposit and legal fees with Shared ownership?

Also do you have to be in full time employment, or can you be unemployed or in part time employment? I understand you have to meet the reypayments but if this was within your means.

Also how do people pay off the other half of the shared ownership? What is the norm, or do they go to there graves still owing the council 50%?

Thanks for any advice!

I did shared ownership with DCC, will tell you what I know and assume that SCDD operate in a similar way.

RE the deposit, you pay the council €1300 when you pick out the place you wish to buy. The council give you a ref number and when you find somewhere you give the ref number to the estate agent and then you give the €1300 to the council.

With legal fees, you can either pay upfront (€3000) or you can add this onto the mortgage amount.

You have to be in full time employment, it's like applying to the bank for a mortgage. You need p60's and payslips.

You must buy out the other half of the loan within 2oyears. Personally I bought mine out ASAP as it makes more finacial sense to do so. All that I had to do was go to a broker and pretty much remortgage, was very straight forward.

I hope this helps!

I went through shared ownership as at the time I was on a low income and wouldn't have gotten a bank mortgage. Also with shared ownership you don't need a huge deposit.

At the time I was buying my solicitor adviced me that I should buy them out the second I was able to and as such insisted that I ring her 9months later to check out the status with the land registry. I never thought in a million years that I'd be in a position to go to a full mortgage within such a short space of time, however I got a big promotion at work and my salary literally doubled over night. As it turns out my full bank mortgage is less that what I'd be paying to DCC now for 50%.

I didn't realise that they'd take benefits as a source of income, like I said I just posted what I know from my experience of the system!

Thanks for the advice, guys.

Just one last thing, I have a council house at the moment, can I purchase this using Shared ownership?

If you're elegible to buy the house, yes you can use a shared ownership loan to do so rather than going through a bank.