Get on prop­erty lad­der

Mort­gage isn’t only op­tion

Evening Express (City Final) - Home Life - - APARTMENT LIVING -

GET­TING on the prop­erty lad­der is some­thing many of us as­pire to, but some of us feel we can’t achieve. Pre­vi­ous prop­erty booms have seen house prices rise ex­po­nen­tially, while the re­ces­sion has made it harder than ever be­fore to se­cure that first-time mort­gage. But there are other op­tions avail­able to those who still wish to buy, but think they can’t af­ford it. If you would like to own a prop­erty, but think that you won’t be el­i­gi­ble for the nec­es­sary mort­gage, then read on. There are lots of great deals on mort­gages out there, not to men­tion a va­ri­ety of al­ter­na­tives. For ex­am­ple, have you heard of shared own­er­ship or shared equity? This is a bit like a cross be­tween rent­ing and buy­ing a prop­erty, de­signed to help peo­ple be­come home own­ers who wouldn’t other­wise be able to. It al­lows you to buy a share in a house or a flat, with the other part owned by the de­vel­oper or a hous­ing as­so­ci­a­tion. With the lat­ter you then pay a re­duced “rent”, known as an oc­cu­pancy pay­ment, for the part of the prop­erty that you don't own. With a de­vel­oper you would typ­i­cally agree to a set term and then pay the per­cent­age back at mar­ket value – al­though you could pay rent or in­ter­est in the mean­time. The monthly cost of your mort­gage re­pay­ments plus your ad­di­tional pay­ment should still come to less than the re­pay­ments on a mort­gage for the whole prop­erty. Af­ter a year, you will then have the op­tion to pur­chase fur­ther shares un­til you own the prop­erty out­right. If you are pre­pared to shop around, you will find that some de­vel­op­ers will of­fer you a 100% mort­gage for cer­tain plots, mean­ing you don’t have to save for a de­posit to get started. Other len­ders will be in a po­si­tion to se­cure you a mort­gage of 95%, mean­ing you need sub­stan­tially less of a de­posit to get your foot on the lad­der. And even if you don’t find an ar­range­ment like that which suits your needs, there are still other ways to buy your own home. You might want to con­sider rent­ing out a room in your prop­erty to a lodger and use the rent to help you pay your mort­gage. con­sider club­bing to­gether with friends and/or rel­a­tives to buy a prop­erty to­gether. Some pri­vate new-build de­vel­op­ers might of­fer you an in­ter­est-free de­posit loan for a first time buyer, and it’s worth check­ing out lo­cal prop­erty auc­tions to see if you can pick up a bar­gain. The key to tak­ing those first steps to buy­ing a prop­erty is to make en­quiries about what’s out there. You might be sur­prised at just what you can af­ford to do.

SHOP AROUND: There are many ways to take the first step on the prop­erty lad­der.

Make it clear this is your in­ten­tion when ar­rang­ing your mort­gage and check the terms care­fully. Al­ter­na­tively you could

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