Shared Ownership Mortgages

Everything you need to know about Shared Ownership Mortgages and how Broker can help you

Firstly, are you looking to purchase a shared ownership / shared equity property?

Home Shared Ownership Shared Ownership Mortgages
Pete Mugleston

Author: Pete Mugleston

Mortgage Advisor, MD

Updated: May 2, 2024

Looking for an affordable way to own a home and get a mortgage? The Shared Ownership scheme is definitely an option worth exploring. If you want to know exactly how these mortgages work, you’re in the right place.

This guide covers all the essential details you need to know about Shared Ownership, even if you’re a cash buyer. We’ll give you the complete lowdown and explain how you can get yourself set up with the best possible rates and terms.

Keep reading for a complete explanation or click on a link to jump straight to a section…

What is a Shared Ownership mortgage?

It’s best to think of it as a hybrid model of homeownership that involves buying part of a house and renting the remainder. Usually geared towards first-time buyers (FTB), it’s a popular government scheme that allows people a more affordable way to get on the property ladder without needing a large deposit.

How does the scheme work?

Shared Ownership means that you’ll buy a portion of a house using a mortgage (or cash). The rest of the property will be owned by a housing association (also known as a registered social landlord) or a local authority (like a council). Because you own some of the property and rent the rest, you’ll usually make both mortgage and rental payments.

This scheme can be an excellent stepping-stone and allows you to buy between 25% to 75% of a property (now 10% to 75% in England). So, you’d end up with a smaller mortgage than if you were to buy the house outright. Another benefit is that your deposit is calculated based on the portion you’re buying, not the total value of the property.

The Shared Ownership scheme is often aimed at first-time buyers looking to purchase a new-build home, but that’s not always the case. If you don’t fall into this category, there may still be options. It’s also worth bearing in mind that these will always be leasehold mortgages.

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How much can you borrow?

Typical income multiples will be used as if you were getting a normal mortgage, but the nature of Shared Ownership means you’ll likely need to borrow less. There’s often no minimum income for Shared Ownership, but it depends on the lender.

Although you may only be able to borrow 4-4.5x your salary, there’s a better chance this will be enough to purchase the home you really want or one that may have otherwise been outside your budget.

Our Shared Ownership mortgage calculator will give you an indication of how much your monthly repayments will be, including both your mortgage and rent payments. All you have to do is enter details for the property purchase price, interest rate, term length, percentage share and the deposit into the appropriate field.

Shared Ownership Calculator

Our shared ownership calculator will give you an indication of how much your monthly repayments will be overall, including both for your mortgage and rent. All you have to do is enter details for the property purchase price, interest rate, term length, percentage share and the deposit into the appropriate field.

Enter the value of the property
Enter the mortgage rate, 5.5% is a typical rate currently but this can vary
Enter the share you're buying as a percentage
Share too high
Enter the mortgage term, 25 years is the average but lenders can offer shorter and longer terms
Enter the deposit amount here
Deposit must be less than property value

Your Results:

Monthly rental payments:

Mortgage repayments:

Total monthly repayments:

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Example calculations

Each lender will calculate how much you can afford in various ways, so it’s best to deal with the right one that suits your situation. But, here are some example calculations showing how much you can borrow based on different income multiples and salaries:

Salary How much you can borrow with each income multiple
3x 4x 5x


£60,000 £80,000 £100,000
£25,000 £75,000 £100,000 £125,000
£30,000 £90,000 £120,000 £150,000
£35,000 £105,000 £140,000 £175,000

Deposit requirements

With some lenders, you’ll be able to buy a home and just put down a deposit of between 5% and 10%. For Shared Ownership, this can mean just 5% of the portion you’re buying rather than the full property value.

So, if you were only buying 50% of the house, the deposit could be just 5% of that amount. This means that your deposit may only need to be equal to 2.5% of the property’s total value.

Example: To purchase 50% of a £200,000 home with a 5% deposit, you’d require £5,000 and need to take out a mortgage of £95,000 (rather than £10,000 deposit and a mortgage of £190,000).

Under some circumstances, it can be possible to get a Shared Ownership mortgage with no deposit if you speak to the right lender. Bear in mind, a higher deposit is likely to get you more favourable mortgage terms and better rates.

How to get a Shared Ownership mortgage

The exact process for securing a Shared Ownership mortgage will vary depending on your individual circumstances, the property you’re looking to buy, and who owns the remaining shares. But, here is a step-by-step guide walking you through the overall process:

gather your documents and register

Before you start approaching lenders or applying for a Shared Ownership scheme, it’s worth getting to hand all your necessary documents. This will include standard items such as photo ID, proof of address, and at least 3 months’ worth of bank statements and payslips.

It’s also worth researching specific properties that you’re interested in buying. Each may have its own rules and stipulations, for example – a common requirement is registering with the local housing association or organisation. Or, you may need to complete an ‘affordable Home Ownership application’ form to confirm you’re eligible.

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Eligibility criteria

Now that we’ve covered mortgage affordability and deposits, here are the main eligibility factors relating to your Shared Ownership application:

  • First-time buyer: to qualify for most Shared Ownership schemes, you’ll need to be a first-time buyer. But, this isn’t always the case. So, if you’re not a FTB, it’s well worth discussing your plans with an expert mortgage broker to get a clearer idea of where you stand. You may still be eligible if you can’t afford a home or are looking to move.
  • Type of property: in most cases, the Shared Ownership scheme will only apply to new build properties. These houses will also usually be developed in partnership with a local council or housing association, but sometimes it’s with private developers. Whether the house is classed as a flat can also make a difference.
  • Income: to qualify for Shared Ownership schemes, your total household income needs to be less than £80,000 a year (or less than £90,000 in London). There’s no minimum income needed for Shared Ownership, but certain lenders may have a minimum amount in their affordability assessments.
  • Loan-to-value (LTV): each lender may still have restrictions around the loan-to-value (LTV) ratio for a Shared Ownership mortgage. So, if you’re only able to put down a deposit for a 95% LTV mortgage, it’s important you deal with lenders who don’t have LTV restrictions or caps that wouldn’t suit your needs.
  • The other owner: with some lenders, it’s important who owns the remaining shares of the property. Most will specify that it needs to be something like a housing association or someone regulated by the Homes and Communities Agency (HCA), or be a registered provider on the HCA register.
  • Your location: there are certain mortgage lenders who will have different rules depending on where you live. Or, only lend to Shared Ownership applicants located in particular regions, for example - Wales, Scotland, or Northern Ireland. Also, in England, it can now be possible to buy an initial share of just 10% with the scheme.
  • Leasehold term: a small number of lenders will have restrictions around the minimum number of years on the lease, for example - less than 85 years. Lenders may also have additional LTV restrictions if the lease is dated before 1st April 2010.
  • Minimum loan amount: there are lenders who will only offer a Shared Ownership mortgage if the sum being borrowed is over a certain threshold of £50,000.
  • Staircasing: some lenders specify they only offer mortgages if you have the ability to eventually own 100% of the property through ‘staircasing’ - a term we’ll explain in further detail later on.
  • Credit history: your credit history will definitely play a role in any lender’s assessment of your application, although yours doesn’t necessarily need to be pristine for this type of mortgage. So, it’s worth downloading all your credit reports in advance to correct any errors or spot areas to improve.

Most home buyers aren’t aware that there are specialist Shared Ownership mortgage brokers in the UK who have plenty of experience with this scheme. If you’d like to speak with one of these industry experts, just make an enquiry and we’ll introduce you to one for free.

Buying more shares in your property

With Shared Ownership, it is possible to buy the rest of your property using a method known as ‘staircasing’. Over time, your financial situation might improve, putting you in a better position to own more of the home and staircasing allows you to do that.

Staircasing means buying more shares in chunks. There can be rules around the minimum you’re allowed to staircase each time, for example – 10%. So, if you were to initially buy 50% of the home, you might decide to buy an additional 10% at some stage and then keep gradually increasing your ownership until you reach 100%.

One important thing to bear in mind is that each time you staircase, a valuation will need to take place. So, the exact cost of your shares for a percentage staircasing increase will depend on the current value, not the original purchase price.

Can you buy a Shared Ownership property without a mortgage?

Yes, this can be done. If you’re a cash buyer, it’s possible to buy a portion of a Shared Ownership property without a mortgage. However, you’d still need to make rental payments on the remaining shares that you don’t yet own as you can only buy up to 75%.

Pros and cons of Shared Ownership explained

Below is a quick breakdown of the major benefits and drawbacks of Shared Ownership you should consider before you get a mortgage.



An affordable way to buy a house


Often, only a low deposit is required.


A specialist broker can still find you competitive rates and terms.


Some new-build properties and developments are only for Shared Ownership buyers.


It can be cheaper than renting


You’ll own equity in the home, which may grow in value.


You can buy more shares through staircasing and eventually own the whole property.


Sometimes you still get the benefits of essential maintenance and repairs covered by the landlord or housing provider.


There is still flexibility and options for moving or remortgaging.


The ability to sell any time you want.



Shared Ownership rules and models can change over time.


You may have to make mortgage and rental payments (although this can still be cheaper than a full repayment mortgage or renting a property).


Each time you buy more shares, you’ll need a valuation.


It can become more expensive to buy more shares if your property goes up in value (but your equity will also be worth more).


Evictions can happen if you fail to pay the rent and negative equity is a possibility.


Leaseholds usually involve a service charge to cover communal maintenance.


Shorter leases can be harder to sell and you may need a leasehold extension at some point.


You’re not allowed to sub-let or rent out a Shared Ownership property (unless you own 100% of the shares).


It can be trickier to secure a Shared Ownership mortgage without expert support from a broker.

Available lenders

The exact selection of mortgage lenders for Shared Ownership will depend on your specific circumstances, where you live, the property you’re looking to buy, and often the size of your deposit. But, here are a few examples of major high-street lenders who are known to be open to this scheme:

  • Principality Building Society – only open to applications in Wales.
  • Pepper Money – has an LTV cap of 75% and a 95% Loan to Share Value.
  • Halifax – income multiples are capped at 4.5x your salary.

As you can see, the rules for each lender can vary. The best way to get a realistic idea of your options is to discuss your situation with an expert broker. They’ll be able to compare Shared Ownership mortgages and find you a top deal, which may mean dealing with a niche lender or finding a bespoke lending solution not advertised to the general public.

Shared Ownership mortgage rates

With the help of your mortgage broker you will also be able to identify which lenders are offering the best interest rate deals for shared ownership. The table below provides a snapshot of what is currently available.

Lender Product Details
Frosted Rates Image

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Last updated December 2023

Please note that the above rates are purely for example purposes and are currently up to date, but are subject to change. Speaking to a mortgage broker is the best way to find the most up-to-date deals at any given time. 

How to remortgage

There may come a point when you want to remortgage a property you’ve bought using the Shared Ownership scheme. Typically, remortgaging will be similar to the standard process, except for the fact that your choice of lenders will be more limited.

If you’re able to buy the remaining shares in your property, this can give you access to a bigger pool of lenders with better interest rates. But, with the right help, remortgaging a Shared Ownership property can be arranged no matter your current situation.

Debt consolidation

One common motivation for remortgaging is debt consolidation, and this is definitely possible with a Shared Ownership mortgage. However, it can be difficult because only a small number of lenders will be willing to work with borrowers who have existing debt issues. So, support from a specialist mortgage broker is often necessary to pull this off.

Can you release equity?

Yes, this is possible. The only catch is that the amount you release must be enough to buy the outstanding shares in the property. So, after you release equity with a Shared Ownership mortgage, you’ll own 100% of the home and can then spend extra funds any way you want.

Speak with a Shared Ownership specialist

Getting set up with the best Shared Ownership mortgage can be a complex and lengthy process without some expert guidance. Speaking with a specialist broker is your simplest path to success.

We offer a free, broker-matching service. This process involves a quick assessment of your needs, and then an introduction to an expert advisor for a no obligation chat.

Just call 0808 189 2301 or make an enquiry. We’ll introduce you to a specialist Shared Ownership mortgage broker for free today.

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Unfortunately not. This scheme is designed for borrowers who plan on living in the home and you’re not allowed to rent any of it out. To do this, you’d need to purchase all 100% of the shares and then look at getting a buy-to-let (BTL) mortgage.

Yes, this is possible but you won’t be able to qualify for a second Shared Ownership property unless you plan on selling the first home, or can no longer afford to live there. The eligibility criteria for Shared Ownership also states that you can’t already own a property – in the UK or abroad.

There are ways to qualify for Shared Ownership and get a competitive mortgage, even if you have bad credit. See our guide to bad credit Shared Ownership mortgages for more information.

It depends on your situation. If you’re a first-time buyer, there’s no Stamp Duty to pay on the first £425,000 of any house costing up to £625,000. Also, you won’t have to pay any Stamp Duty until you own 80% of the shares.

However, you can choose to voluntarily pay Stamp Duty on the full value as if you were buying outright. This will be a large added cost but means you never have to pay any more Stamp Duty, even if you buy more shares over 80% at a higher price.

Keep in mind there can be a Stamp Duty charge based on the lease premium (rent payable over the lease term), known as the ‘net present value’. Expert advice is highly advisable when it comes to creating the most tax-efficient arrangement for your individual circumstances.

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About the author

Pete, an expert in all things mortgages, cut his teeth right in the middle of the credit crunch. With plenty of people needing help and few mortgage providers lending, Pete found great success in going the extra mile to find mortgages for people whom many others considered lost causes. The experience he gained, coupled with his love of helping people reach their goals, led him to establish Online Mortgage Advisor, with one clear vision – to help as many customers as possible get the right advice, regardless of need or background.

Pete’s presence in the industry as the ‘go-to’ for specialist finance continues to grow, and he is regularly cited in and writes for both local and national press, as well as trade publications, with a regular column in Mortgage Introducer and being the exclusive mortgage expert for LOVEMoney. Pete also writes for Online Mortgage Advisor of course!

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Pete Mugleston

Mortgage Advisor, MD

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