Shared Ownership Mortgage Guide and FAQs

At Share to Buy we understand that for those who have never needed one before, the prospect of finding a mortgage can be daunting. The good news is Share to Buy have 15 years experience in helping first time buyers arrange the right deals for them.

This guide and the FAQs at the bottom of the page cover all you need to know about finding a mortgage for your Shared Ownership home. When you are ready to start your search for a mortgage you can you use our Mortgage Comparison tool, and our specialist team can help you every step of the way.

Types of Mortgages

There are several different types of mortgage products on the market. The most common are:

Variable (Standard Variable Rate)

A variable or standard variable rate mortgage is a rate which is set by each mortgage lender and is the rate which borrowers will usually revert to once they have come to the end of an initial fixed or tracker rate.

Fixed Rate

A fixed rate mortgage is one where the interest Rate that you pay is fixed for a set period of time usually 2, 3, 5 or 10 years.

Tracker Mortgage

A tracker mortgage is one where the interest rate will be a given percentage (currently above) the Bank of England base rate for a set period of time. It is a variable rate as the interest rate will change at the same time as any change in the Bank of England base rate.

Discount Mortgage

A discount rate is a variable rate that offers a discount on the lenders’ standard variable rate for a set period – normally 2 to 5 years.

Interest Only

Mortgage lenders are generally only willing to consider an interest only loan if you have a 50% deposit or more and where you can show an acceptable repayment plan. In practice the housing association is most unlikely to agree to your taking out an interest only mortgage on a Shared Ownership purchase.

Which mortgage type is best for me?

Deciding on the most suitable mortgage type for you will very much depend on you financial situation and your appetite for risk.

You are more likely to find a fixed rate preferable if:

  • You are on a tight budget
  • You think that interest rates will increase
  • You prefer to know what your repayments will be over a period of years

A variable rate could be preferred if:

  • You require the lowest possible rate
  • You can afford to increase your repayments if interest rates rise
  • You require a scheme that does not have early repayment charges


Browse our helpful FAQs below to answer any Shared Ownership mortgage questions you may have.

When should I start looking for a Shared Ownership mortgage?

You will not need to do this until you have chosen a property to buy. Your housing provider will put you in touch with a financial advisor to help you with a mortgage, or you can search for a mortgage online with Share to Buy.

What are the benefits of using Share to Buy for my Shared Ownership mortgage?

Our hugely experienced mortgage team specialises in Shared Ownership and we can access lenders across the market with a wide range of products, inc. 5% deposit options. We charge a relatively low fee low (full details of fees here) and for every mortgage we arrange we donate £10 to the homeless.

Do I have to use the Financial Advisor recommended by the housing association?

No. You will need to have a financial assessment with one of the financial advisors working with the scheme. However, you can use your own financial advisor to arrange the mortgage. You may find it faster and more cost effective to use a financial advisor familiar with the schemes. If you would prefer to arrange your mortgage online, Share to Buy have a team of mortgage experts that can assist you in doing so.

Why is the housing provider asking for a higher deposit than the mortgage lender?

The housing provider has to carry out an eligibility assessment based on the Homes and Communities Agency affordability calculations. This assessment will determine the deposit amount they require before they offer you a property.  It may be that this deposit is higher than the minimum mortgage lender requirements.

Can I use a guarantor for my Shared Ownership mortgage?

No, under the terms of the scheme, this will not be permitted.

Can my parents be on my Shared Ownership mortgage with me?

No, only those who are party to the Shared Ownership lease can be on the mortgage application. All applicants must live at the property as their main residence. However, your parents may wish to assist with the deposit by way of a non-repayable gift.

What does a Mortgage Broker do?

A mortgage broker’s main task is to arrange a suitable mortgage for you. This will involve taking details about your personal and financial situation and then using that information to find a mortgage lender or lenders where you meet the lenders criteria and affordability requirements for the property that you wish to buy.

The broker will be able to answer any questions that you have and advise you on suitable mortgage products. They will assist you with the necessary paperwork so that a mortgage application can be submitted. They will then do everything possible to help progress your application though to your receiving an offer.

What is an Agreement in Principle?

An Agreement in Principle (AIP) is an agreement from a mortgage lender that they will lend you the mortgage amount requested, subject to satisfactory proof of income and valuation of the property.

Before issuing an Agreement in Principle the lender will carry out a credit check and subject your application to their internal credit scoring. This agreement is not binding on either you or the lender. An Agreement in Principle is the first part of the process of applying for a mortgage.