If you are a tenant and living in a council house or housing association home looking to purchase your home, you may be eligible for the discount that the government offers through a certain scheme, these are called right to buy and right to acquire. Certain criteria is required to be met when applying for the scheme.

Right to Buy

Council tenants can purchase their property using this scheme if they meet the criteria for the right to buy scheme:

• Being a secure tenant with a signed contract in place between landlord and tenant
• Your only/main residence
• Having a public sector landlord (council, housing association or NHS trust) for three years (doesn't have to be consecutive), if you rent privately you won't be eligible
• A self contained home is a must, nobody from outside your household living in the property

The amount of discount granted will vary depending on the areas of criteria you meet. The maximum discount is £87,200 across England, except in London boroughs where it is £116,200. It will increase each year in April in line with the consumer price index (CPI). The few factors that need to be considered when applying for the right to buy schemes such as the type of property you are purchasing whether it's a house or a flat, how long you have been a public sector tenant for and the market value of the property.

The duration of your residency at the property also matters. If you are living with someone who didn't move into the property at the same time as you, then you use the number of years of who has been a council tenant the longest.

Your discount may be reduced if you have used right to buy in the past. If you decide to sell your home within the first five years of purchasing it, then you usually have to repay all or some of the discount back. Stamp duty may also be applicable so always check with a solicitor or financial adviser before you confirm your house purchase budget.

When you are budgeting for a house purchase there are new factors to take into consideration as you will gain new responsibilities such as maintenance costs, solicitor fees and possible advice fees if you see a mortgage broker. The lender may also charge certain fees.

For more information on Right to Buy visit https://www.gov.uk/right-to-buy-buying-your-council-home

Right to Acquire

Right to acquire has many similarities to right to buy, the biggest difference is the amount of discount you receive.  If you have had a public sector landlord for 3 years you may be able to apply for the right to acquire scheme and purchase your housing association home. The different types of landlords are housing associations, councils, the armed services, NHS trusts and foundation trusts.

You aren't eligible for right to acquire if:

• you have a court order to leave your home
• you have been made bankrupt
• you have preserved right to buy
• you are a council tenant - Right to Buy is the option for you instead

Similar to right to buy, your home must be self contained and your main or only home. If you are looking to do a joint application, this can be done with someone who is on your current tenancy with you, you can also apply with up to three family members who have lived with you for the past 12 months (even if they aren't on your tenancy now).

However, one difference is that your house must also have either been built or bought after 31 March 1997 by a housing association and funded through a social housing grant provided by the Housing Corporation or by a local council.

You can get a discount of between £9,000 and £16,000 on the price of your property. The amount of discount you’ll get depends on where you live in the UK. Your discount might be reduced if you’ve used Right to Acquire or Right to Buy in the past.

For more information on Right to Acquire visit https://www.gov.uk/right-to-acquire-buying-housing-association-home

Finding the right advice

Applying for a Right to Buy/Right to Acquire mortgage is pretty similar to a standard mortgage. Many lenders (but not all) will accept your discount on the property as an initial deposit when you apply.

In order to purchase your home through Right to Buy or Right to Acquire you must contact your council or housing association to check your eligibility.

If you are unsure of whether you qualify for these schemes then it is always best to speak to the landlord or consult with a financial advisor, an experienced mortgage broker may also be able to advise you on this.

Looking to purchase the property you are a tenant in? contact us at [email protected] or call us on 0151 662 0188.