The Right to Buy scheme allows individuals living in council properties the opportunity to purchase the property they’re living in if they have lived there for a prolonged period of time. You will be offered the opportunity to purchase at a discounted price. This proposed discount will be used as your deposit meaning you are able to organise your remaining savings to help with the rest of the process.
You may also be able to borrow money if you want to make home improvements for the property. Some lenders may allow this but you will need permission from the Local Authority beforehand.
The Right to Buy scheme was deemed helpful around the time of the 80’s when it allowed a lot of individuals to become homeowners for the first time. On the other hand, it was deemed controversial. The main reason for this is due to the dilemma of the scheme turning the homes into privately owned therefore taking them off the public sector – this can be a disadvantage when there is already a housing shortage. As a result of this, dynamics of council estates have changed.
If you’re interested In the Right to Buy scheme, the first step is to see if you’re eligible to purchase the property; this is done by completing a RTB1. Following this, a person will arrange to value your property and inform you how much the property amounts up to. From this, you’ll find out the percentage discount you’re entitled allowing you to gain more of a level idea of future figures involved with the mortgage. You will then be able to move forward after filling out forms included in a pack that will be sent to you by your local authority allowing you to move onwards.
The way that lenders will calculate how much you’re able to borrow is done by the same way as any other mortgage: based on your income and expenditure. This means that it’s still important for you to look ahead and be sensible with your finances, along with checking your credit score.
There are fees involved just as there is with other mortgages so you can prepare and be ready. These can include:
The Right to Buy was set up so that individuals were able to have a wider opportunity to become a Homeowner and start their journey on the property ladder. If the involved property is sold before a certain amount of time, then you will be issued a penalty. This will be in the form of repaying a sum of money linked to the original property discount generously presented at the start of the process.
It is certain factors such as carrying out their own repairs and maintenance that entails with owning a home, that people are deterred from the Right to Buy scheme. On the other hand, the majority of people who do wish to take the opportunity, do so because if they tried another way, it may prove more difficult.