buying with Your Home...
making homes affordable...
Your Home by heylo... Launched in September 2014, heylo has created one of the largest shared ownership delivery programmes in the UK, delivering a step change in shared ownership housing across England and Wales. Your Home is heylo s shared ownership scheme available on second hand properties, with Your Home, you buy part of the property and rent the rest. Your Home brings the low deposit and affordability of shared ownership to thousands of existing properties on the second hand market, available through estate agents countrywide. Typically, Your Home is more affordable than traditional mortgage repayments and therefore means a bigger buying budget. There is no need for a mortgage (if you don t want one) and you have the right to buy a larger share, sell or move at any time. 3
... you will only need a 10% deposit to get on or move up the housing ladder
who can use Your Home... You can use it if... You must have... You must also... Household incomes can be... The property must... You can t use it if... You re looking to move home You re looking to stay in your current property without the need for a mortgage You re part of a family breakup situation including divorce A sufficient cash deposit (at least 10% of the full OMV) Good credit history (you should be able to access a mortgage for a lower value property) A household income at or below 80,000 ( 90,000 in London) Income to support you Be in permanent employment, have a pension income or similar Be a British or EU citizen or have indefinite right to remain in the UK Be using Your Home to buy your sole and principal place of residence Not have been bankrupt or have any outstanding bad credit such as CCJs Employment Self employment Pension income Maintenance payments including Tax Credits and benefits Be of a traditional construction Be immediately habitable Be second hand (at least one year old and have been lived in) Not be sold at auction You are an investor Buying to let out the property It means you will have two properties You would like a brand new home 5
how Your Home works... apply approval find offer 1 2 3 4 visit www.yourhome.org.uk and complete the online application form...any questions on the application process, please contact the Your Home team, who will be happy to help application approval takes 24-48 hours Once approved, an agreement in principle will be issued This will outline the maximum amount you can offer on a property find an exisiting property for sale on the open market across England and Wales This can be with any estate agent make an offer on a property Once your offer has been accepted, contact the Your Home team
instruct progress complete move in 5 6 7 8 instruct a RICS Valuation report and a solicitor Pass both their details onto the Your Home team...need help finding a solicitor, we can advise you on a selection who are experienced with shared ownership your estate agent will progress the sale in the ususal way Please ensure you submit the correct documents at the timings outlined on completion, 100% of the property is purchased by heylo and your share is sold to you at the same time move in, relax and enjoy your new home! The Your Home team are always here and happy to help
your place... your space! 8
benefits of Your Home... Personal approach Enchanced affordability You effectively will be a cash buyer (heylo buys directly from your vendor with cash) Properties can be freehold or leasehold Greater flexibility Bigger buying budgets Entitled to 75% of any value increase on the unpurchased share Estate agent guides you alongside the Your Home team More room for negotiation Increase the speed of your purchase No restrictions on decorating or maintenace 9
... it s likely that you will need to have at least 3,500 set aside to cover costs
what Your Home costs... Professional RICS Standard Valuation Report The price will vary depending on the value of the property, however reports typically cost around 200-500. This is paid at the point of instructing solicitors. Your Home product fees Your Home product fees are fixed at 1,200 for freehold properties and 1,800 for leasehold properties. Property searches This includes Local Authority, water, drainage and environmental enquiries carried out on your behalf, usually in the region of 450. Deposit on exchange On exchange, you will need to pay a cash deposit of 10% of the property value. If you are buying more than a 10% share, this deposit will form part of your purchase price. The remainder will be payable on completion via your solicitor. Rent on completion Rent is payable monthly, in advance on the share you do not own starting at 4.89% per annum on the value of the unpurchased share. The table shows how your rent might increase, each year (based on 2% inflation and a 10% deposit). 1st Year 2nd Year 3rd Year rent on a 200,000 property 733 pcm 753 pcm 774 pcm rent on a 300,000 property 1,100 pcm 1,130 pcm 1,161 pcm rent on a 350,000 property 1,283 pcm 1,318 pcm 1,355 pcm Stamp Duty Land Tax (SDLT) Property purchases and leases over 21 years with rent over certain value are subject to SDLT. Your solicitor will advise you on the current rate. Typically, SDLT payable under the Your Home lease is less than the amount that would be payable if you had purchased the property outright. 11
... Natalie was a recently divorced mother of two
Your Home in action... Natalie was a recently divorced mother of two when she found Your Home back in September 2016. She was able to raise a 10% deposit however didn t have the income to support a mortgage for a suitable property in her chosen area of Milton Keynes.... My sister first heard about the Your Home scheme and thought it sounded ideal for my circumstances. I was in a position where I had a large deposit however being a single income household, I was unable to secure a large enough mortgage to buy a suitable property in a desirable area of Milton Keynes. Initially I was drawn to shared ownership as it seemed the most affordable way for me to get on to the housing ladder on my own. Unfortunately shared ownership homes around Milton Keynes sell extremely well and usually with a hefty premium, so the option of purchasing from the open market sounded fantastic as it meant I could avoid sitting on waiting lists for new build properties that I wasn t overly keen on. I applied for the scheme in September and was approved within a couple days. I then enlisted the help of a local of estate agent and found a three bedroom semi-detached home with a garden and had an offer accepted within just a matter of weeks of applying. As a first time buyer, the process was very daunting especially as the scheme seemed too good to be true! The transaction ran so smoothly and I quickly completed on my new home in early December. Looking to the future, I am exploring the possibility of staircasing to a larger share, however for now I am just enjoying settling into my own home with my family. 13
by now you ll have some questions...
FAQ s... How much can I buy? At the outset, the minimum share you can buy is 10% of the property value - there is no maximum (heylo s minimum purchase is 100,000). Over time, you can purchase more of your property, thereby decreasing the amount of rent you will have to pay. Gradually increasing the ownership percentage in this way is known as staircasing. Properties purchased via Your Home will be on a shared ownership lease, which for freehold properties will be for 999 years (the term of a virtual freehold ) and for leasehold properties, 125 years. This lease will set out your rights to occupation as well as your obligations as a home owner. Can I buy any second hand property? Yes you can, provided that for leasehold properties there is more than 125 years remaining at the point of purchase, they are of standard construction and good habitable condtion within either England or Wales. Can I take out a personal loan to pay for costs or fund part of my deposit? Yes, you can providing that it is unsecured. You will need to make the Your Home team aware of this during the application process. The Your Home team will need to see that you have the funds available and take into account this loan and any other loan repayments you may have as part of the Your Home affordability assessment. If I change my mind at any time can I withdraw from the process? Yes, of course. Until the exchange of contracts you are not legally bound to anything, so are free to change your mind. We would strongly recommend that you think about any reasons for not wanting to proceed before starting the process, as any fees paid are non-refundable. 15
FAQ s... How do I buy a bigger share? The Your Home lease sets out the process to allow you to buy a bigger share at any time. As with the initial purchase, an independent valuation will be undertaken and this will be used in a calculation specified in the lease to work out how much you will need to pay based on the size of the additional share you wish to buy. As well as the cost of a valuation, buying a bigger share will also involve legal fees and SDLT. What if I want to move? The Your Home lease sets out the process to allow you to sell your property outright and your entitlement to the sale proceeds. Like the initial purchase, an independent valuation will be undertaken. When you sell outright the actual sale price will be used in the calculations specified in the lease to work out how the proceeds are divided. If I want to buy an ex-partner out of the property, can I do this? Of course, this is a great way of using Your Home, providing you can afford the monthly rent payment and there is a minimum of 10% equity value left in the property to act as your deposit. You would be able to repay the mortgage and any money owed whilst staying in your own home. After heylo purchases the property and you purchase your share through Your Home the property will be solely in your name. 16
FAQ s... What is the Your Home lease? This is a legal agreement, that details what is expected of both the landlord and the leaseholder and has been created from a standard industry form but adapted to give you the benefits of Your Home. How many people can be on a Your Home lease? There is a maximum of 2 applicants per purchase, the individuals do not need to be related in any way. How do I work out my household income? Household income is the combined gross income of the members of a household who are of a legal working age and are going to be applicants for Your Home and ultimately own a share of the property. Household income is an important measure used by heylo to assess affordability. What is a RICS Standard Valuation Report and who needs to arrange this? This is a market standard property valuation. You will be required to organise and cover the cost of this. This will tell you the construction type of the property as well as the valuation. The cost of a report will vary depending on the value of the property but they typically cost around 200-500 with payment made at the point of instruction. What are the legal fees and associated costs? You will need to instruct a solicitor to act on your behalf. You can select from Your Home s list of experienced solicitors. Disbursements (third party costs) such as Land Registry fees, search fees etc. will be charged in addition to the solicitors fees. Your solicitor will also advise you on the cost of any SDLT. 17
FAQ s... What else will I need to pay for, in addition to the monthly shared ownership rent? In addition to the rent, the Your Home lease will require payment of an annual management fee (currently at 181.44) and buildings insurance both are payable monthly in advance. Once completed, you will need to pay the rent, management fee and buildings insurance for the remainder of that month, together with the following month. Your solicitor will be able to inform you of the total amounts payable prior to completion. Who will be responsible for the upkeep of the property? You will be responsible for the upkeep of the property. Where the property has commual cleaning, lighting and maintenance including parking and shared gardens or un-adopted roadways, you may also be subject to third party services charges. You will need to request information on the services and estimated annual costs from the property vendor before deciding to purchase as these costs will be included in the application process and affordability assessment. What solicitor should I use to buy my share? Your Home has a selection of solicitors for you to choose from who are experienced in the sales process. These solicitors have been nominated as not only do they offer excellent customer service and value for money but they also understand Your Home and shared ownership. These solicitors will be able to help ensure that the buying process is a smooth and stress-free process. Does Your Home charge ground rent? If the property you are purchasing already has a ground rent charge, typically on leasehold properties, this will be passed on to you. 18
... contact Your Home 020 3744 0408 applications@heylohousing.com Monday - Thursday 9am - 6pm Friday 9am - 5pm
www.yourhome.org.uk applications@heylohousing.com 020 3744 0408