Problems highlighted by SPF Sherwins include: -

• lenders offering only one type of scheme rather than a range but branch staff not giving the correct information
• lenders withdrawing offers when they discover that clients are buying their home through an affordable housing scheme
• lenders being asked to pay for a much larger share than they had originally been led to believe thus making the deal unviable

There are essentially three types of scheme. Home Buy; Shared Ownership and Key Worker schemes.

Home Buy gives tenants in social housing the opportunity to buy their own home. Tenants buy three quarters of their property using a commercial mortgage and the housing association gives an interest free loan to purchase the remaining 25%. When they sell their property they have to repay the housing association loan.

Shared Ownership lets tenants buy a part of their home and then rent the rest from a housing association. They can buy between 25% and 75% of their property and purchase the rest over a period of time.

The Key Worker scheme is aimed specifically at teachers, nurses, police officers, fire fighters. Social workers and a prescribed list of other professions considered by the government to be “key” to the community. Such schemes consist of a set grant to aid initial purchase.

In an effort to end confusion over affordable housing schemes the government is set to re-launch the affordable housing schemes next spring but in the meantime information can be found on the website listed below: -

www.firstrungnow.com