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Right to buy mortgages are for use by public housing
tenants who wish to purchase their property under the
Right To Buy Scheme. Public housing tenants are people
who rent their property from the local council, a non-charitable
housing association or a housing action trust. The vast
majority of Right To Buy sales are of local authority
properties.
The Right to Buy scheme was first introduced in 1980,
with the main aim of offering everyone the opportunity
to own a decent home and so promote social cohesion,
well being and self-dependence. The Right to Buy Scheme
has since helped nearly 1.5 million council tenants
in England to realise their aspirations to own their
own homes, with ongoing sales under the scheme now running
at around 40,000 a year.
The Right To Buy scheme enables tenants to buy their
homes at a discount price, provided that they have been
living in their home for two years and meet the other
qualification criteria. The RTB scheme is open to virtually
any secure tenant who can afford to buy with the exception
of dwellings occupied in connection with their employment
and housing specially provided for the elderly and (in
certain cases) the disabled.
There are two options available under the right to
buy:
1. You can buy your home by paying the full purchase
price at once with discounts ranging from 32% to 70%
dependent on how many years you have spent as a public
sector tenant and subject to a maximum discount limit
for the area you live in.
- Houses: The discount after two years is 32% with
an additional 1% for every extra year up to a maximum
of 60%.
- Flats: The discount after two years is 44% with an
additional 2% for every extra year up to a maximum of
70%.
There has always been a cash limit on Right To Buy
discounts, but new limits came into effect on 11 February
1999, affecting all applications made by tenants on
or after that date. The changes were made in order to
ensure that the scheme provided better value for money
for taxpayers, as well as still offering generous discounts
to purchasers. Subject to the cash limit, tenants are
still eligible to claim up to 60% in discount off the
market value of their house and up to 70% off a flat
depending on the number of years they have been a public
sector tenant. For anyone who applies after 10 February
1999, the maximum cash limit on discount is:
- £38,000 if you live in London or the South East
- £34,000 in the Eastern Region
- £30,000 in the South-West
- £26,000 in the North-West or the West Midlands
- £24,000 in Wales, the East Midlands or Yorkshire
and the Humber
- £22,000 in the North-East
2. You can use the Rent To Mortgage scheme if you want
to buy your home, but can't afford to pay for it all at
once.
Further details on both schemes can be found in the
booklet Your Right to Buy your Home. It is strongly recommended
that you read this booklet before applying for the Right
to Buy. It can be obtained either through your landlord
or by phoning the number below.
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Right to buy mortgages :