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Guides – Mortgage Schemes

Mortgage Scheme Guide

Shared Ownership Mortgages 

A Shared Ownership mortgage is a type of mortgage that allows you to buy a share of a property (usually between 25% and 75%) and pay rent on the remaining share to a housing association or other designated provider. Shared ownership mortgages are designed to help first-time buyers and people with lower incomes to get onto the property ladder by making it more affordable to buy a home.

With a shared ownership mortgage, you would take out a mortgage to buy the share of the property that you can afford, and pay a subsidised rent on the remaining share. For example, if you buy a 50% share of a property worth £200,000, you would take out a mortgage for £100,000 and pay rent on the remaining £100,000 share. 

You can usually increase your share of the property over time by buying additional shares, known as “staircasing”.

Right to Buy Mortgages

A Right to Buy mortgage is a type of mortgage that is designed specifically for council or housing association tenants who wish to purchase the home they are currently renting from their local authority or housing association.

Under the Right to Buy scheme, eligible tenants have the right to purchase their rented property at a discounted price, which is usually based on the length of time they have been a tenant. Right to Buy mortgages are specifically designed to help tenants access the funds they need to purchase their home through the scheme.

Right to Buy mortgages are similar to other types of mortgages, in that they are usually long-term loans that are secured against the property being purchased. The amount that can be borrowed through a Right to Buy mortgage will depend on a range of factors, such as the value of the property, the borrower’s income, and their credit history.

As with any mortgage, it’s important to carefully consider your options and seek professional advice before taking out a Right to Buy mortgage. This will help ensure that you choose the right mortgage product for your needs and circumstances, and that you are able to meet your mortgage repayments over the long term.

Shared ownership mortgages can be a good option for people who are struggling to save for a deposit, as the deposit required is typically lower than for a traditional mortgage. They can also offer more affordable monthly payments, as the rent paid on the remaining share is often lower than the equivalent mortgage payments.

It’s important to note that not all properties are eligible for shared ownership, and there may be restrictions on the percentage of the property you can buy and the housing associations or providers that are available in your area. It’s important to carefully consider your financial situation and the terms and conditions of the shared ownership scheme before deciding if it is right for you.

Help to Buy: Mortgage Guarantee Scheme 

The UK government has extended the mortgage guarantee scheme until the end of December 2023. This scheme provides support for those who are looking to buy a home with a small deposit. The government guarantees a portion of the mortgage, making it possible for borrowers to secure a mortgage with as little as a 5% deposit on a property’s value. This scheme is intended to help first-time buyers and those who struggle to get a mortgage due to a lack of available funds for a large deposit.

The scheme has already helped over 24,000 households up to November 2022. The scheme has also supported the wider housing sector, which suffered during the COVID-19 pandemic. Lenders reduced the availability of high Loan-to-Value products during the pandemic, with just eight 95% LTV products available in January 2021. The government’s mortgage guarantee scheme has helped restore competition and consumer choice to the market, which has benefited businesses and boosted the market.

The mortgage guarantee scheme is available to anyone looking to purchase a residential property in the UK with a mortgage of up to £600,000. It is available for both new-build and existing properties and to both first-time buyers and home movers. The borrower must have a deposit of at least 5% of the property’s value, up to a maximum of 95%. They must pass affordability checks and satisfy the lender’s other lending criteria, such as credit history and income. The property must be the borrower’s primary residence and not a second home or buy-to-let property.

Despite the guarantee, borrowers will still be responsible for making mortgage payments and complying with the terms of the mortgage agreement. The scheme has helped many people get onto the property ladder who would otherwise struggle to do so due to a lack of available funds for a large deposit.

First Homes Scheme

The First Homes scheme is a new initiative launched by the UK government to provide discounted homes for first-time buyers and key workers. The scheme is aimed at helping those who would otherwise struggle to get on the property ladder due to high house prices.

Under the scheme, first-time buyers will be able to purchase homes at a discount of at least 30% off the market price. The discount will be funded by a combination of developer contributions and Section 106 agreements, which require developers to provide affordable housing as part of their planning permission.

The First Homes properties will be available to eligible buyers who meet certain criteria, such as being a first-time buyer, a key worker, or a member of the armed forces. The scheme is also open to local residents and those with a connection to the local area.

To be eligible for the scheme, buyers must have a household income of less than £80,000 per year (£90,000 in London) and must be able to raise a mortgage of at least 50% of the discounted purchase price. The maximum purchase price for a First Homes property is £250,000 (£420,000 in London).

Lifetime ISA

The Lifetime ISA (LISA) is a savings account designed to help people save for their first home or for later life. To open a LISA, you must be between 18 and 39 years old.

You can save up to £4,000 each tax year, and the government will add a 25% bonus to your savings, up to a maximum of £1,000 per year. This bonus is paid into your account at the end of each tax year.

You can use the money in your LISA to buy your first home, as long as the property costs £450,000 or less, and you are buying with a mortgage. You must have had the LISA open for at least 12 months before you can use it to buy a property.

If you’re buying with another first-time buyer who also has a LISA, you can both use your LISAs towards the same property, effectively doubling your bonus.

However, if you withdraw money from your LISA for any reason other than buying your first home or withdrawing after age 60, you will be charged a penalty of 25% on the amount withdrawn. This means you will get back less than you put in, including the government bonus.

Help to Buy: ISA

A Help to Buy ISA is a savings account for first-time buyers in the UK that offers a government bonus towards the purchase of a home. For every £200 saved, the government adds a £50 bonus, up to a maximum bonus of £3,000.

When it comes to getting a mortgage, having a Help to Buy ISA can be beneficial as it can be used as a deposit towards the purchase of a home. The bonus is only paid upon completion of the purchase, so it cannot be used for the initial deposit or exchange deposit. However, the money saved in a Help to Buy ISA can still be used towards the initial deposit.

The maximum purchase price for using a Help to Buy ISA to buy a property is £250,000 outside of London and £450,000 in London.

It’s worth noting that the Help to Buy ISA closed to new accounts on 30 November 2019. However, those who already have a Help to Buy ISA can continue to use it to save and claim the government bonus until November 2029.

The scheme is being rolled out gradually across the UK, with the first wave of properties launched in June 2021. The government has committed to building at least 1,500 First Homes properties by March 2022, with the aim of providing at least 10,000 homes per year in the future.

The First Homes scheme is intended to provide a long-term solution to the UK’s housing affordability crisis by making it easier for first-time buyers and key workers to get on the property ladder. By offering discounted homes, the scheme aims to create more sustainable and inclusive communities, with a mix of affordable and market-rate housing.

The Financial Conduct Authority does not regulate building surveyors.

Thameside Mortgage Ltd are not regulated by The Royal Institution of Chartered Surveyors, we do not have any involvement in the provision of this type of service / activity. We are not qualified surveyors and the information provided on this website is for informational purposes only. The information provided is not intended to be a substitute for professional advice, inspection, or survey.

It is important to seek professional advice and to undertake a proper survey/inspection before making decisions or taking actions related to a property.

What Our Clients Are Saying

  • I really can’t recommend Thameside Mortgages enough. From start to finish, the process was very well explained and completely hassle free. They found me an amazing deal and their communication, responsiveness and support was second to none. A heartfelt thank you to Andrew, Laura and Lydia; keep up the brilliant work.

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    J Avatar J

    I could not recommend Thameside Mortgages More! Andrew is always fantastic to deal with, he is always extremely responsive, supportive and helpful! Thanks to the team at Thameside and Andrew for your constant support!

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  • Andrew, Laura and the Thameside team were fantastic and delivered a brilliant result for us. They were able to secure two competitive mortgages for our remortgage and new house purchase. These were secured in a matter of weeks and then Thameside guided us through a tricky exchange and completion process with minimal fuss and stress. Thank you Thameside for a providing a wonderful service and we’ll sure to be back again in the future!

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    The team went above and beyond to help us secure the best possible rate. During what was a difficult time for us, they’ve been so supportive and empathic. Their work is delivered with pedagogy and transparency, for customers to understand relevant details and take informed decisions with confidence. I strongly recommend their mortgage services.

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    First class and professional service. The advice given on various mortgage products, terms and insurance options were excellent. Throughout the sale/purchase they were in constant contact with my solicitor and estate agent, and kept me up to date regularly. Would highly recommend.

    Nick Harris Avatar Nick Harris
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    I had heard great things about Thameside Mortgages before we used them to buy our new home, and they certainly did not disappoint! Andrew and his team were friendly, thorough and efficient from start to finish, which made what initially felt like a daunting process completely stress free. The team went above and beyond on multiple occasions, including to resolve a couple of unforeseen issues that we encountered with our mortgage application, proving that we couldn’t have done it without them! I will definitely be using them again for any future house purchase / remortgage.

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  • Andrew’s experience and knowledge of the market was next to none, which allowed me to get the perfect mortgage deal. Followed by Laura’s communication made the whole process very comfortable. It wasn’t as easy ride with many hiccups from my end but Thameside stuck with me throughout the entire process until I picked up my keys and more. Highly recommend.

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    Sarah Blanks Avatar Sarah Blanks

    This is the second time I've instructed Andrew Sheen at Thameside Mortgages to find and secure the right deal for me. On both occasions I've had complete confidence in his ability to work with my best interests at heart. So professional and personable, I hope to always work with him when moving house or remortgaging. Not to mention, he's also a really top bloke. Thank you Andrew and team. Let's do it all again in 5 years time.

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    Great service from start to finish, made the whole process very smooth and easy

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    Thameside Mortgages, Jason Senior Financial Adviser is the most proactive Adviser I have had the pleasure of working with. He helped me not only with the purchase of my Property 5 years ago but also with my Remortgage couple days ago, very versatile with a lot of knowledge and huge experience a really great, amazing person. My e-mail was answered frequently within a minute, he was quick on the document chase. Friendly professional, service, I definitely recommend it. And very decently. Thank you so much Jason.

    stanislaw oleniacz Avatar stanislaw oleniacz
  • This is the 3rd time I have used Thameside Mortgages , I was so impressed with their professionalism and quick response. They helped me through every step of the way and continue this service after completion. It was such a pleasure throughout the whole process , I would definitely recommend this company to all my friends and family . Mrs Pamela Payne

    Pamela Payne Avatar Pamela Payne

    Absolutely the best, most helpful and speedy broker I've ever worked with - Thameside sorted everything including finding the right mortgage and insurances for me, guiding me through the applications and keeping me posted throughout the process. Particular thanks for their endless patience with me dithering over every decision, but because of their honest and clear advice, I'm completely comfortable I've made the right choices. I really couldn't recommend these guys enough!

    Kate D Avatar Kate D

    We brought our first home nearly 2 years ago, we had Jason Harris as our advisor. I can’t put into words how much he helped from the very first call to present day with our remortgage and life insurance. Jason has been incredible from the get go, it felt as though we didn’t have to do anything really, as he found everything for us and gave multiple options so all we did was say yes or no. He broke everything down and explained things in such a simple way for us to not get too overwhelmed. He made everything feel stress free and simple, as well as finding us an incredible offer twice he has also found cheaper life insurance policies for us which is something I didn’t even think to do, he has saved us £100’s of pounds overall with our new offers. Really appreciate having him as our advisor and he’s a really helpful and lovely guy. Thank you Thameside & Thank you Jason.

    chelsea melbourne Avatar chelsea melbourne