Right to Buy mortgages with Bad Credit

This depends on the lender. Most lenders will treat your Right to Buy discount as a deposit, but this is not universal and some will still ask for a cash deposit.

This may also affect your choice of lender when looking at mortgages for Right to Buy with bad credit.

The scheme applies to both houses and flats and does not specifically exclude flats in high-rise buildings.

However, some lenders have restrictions on the types of properties on which they lend, so they may not grant mortgages on high-rise flats. Ensure that any lenders or mortgage brokers you speak to are aware upfront of the type of property you want to buy.

The Right to Buy scheme does not have an upper age limit. Some lenders, however, do have upper age limits for mortgage applicants. This is partly because they need to be sure you can afford to keep paying the mortgage, including after retirement.

You can apply for a Right to Buy mortgage jointly with your spouse or civil partner. Alternatively, you can apply with anyone else who shares your tenancy, or with up to three family members you have lived with for the past 12 months. Some borrowers may also be more flexible with their maximum age requirements. This could apply in cases where a Right to Buy mortgage application is made jointly with a younger family member.

It may be possible to borrow extra money against the property to carry out home improvements. This will depend on:

• The value of the property.
• The level of the Right to Buy discount.
• The lender’s maximum loan to value (LTV).

Be aware that, for leaseholds, you may have to get permission from the freeholder before making any changes; this is usually your current landlord.

Buying your property through the scheme doesn’t disqualify you from letting it out afterwards. However, lenders do have a say over this, and it depends on what type of mortgage you take out.

If you intend to let out the property immediately and on a long-term basis, you will need a Buy-to-Let mortgage. It can be more difficult to get a Buy-to-Let mortgage as many lenders will not permit these for Right to Buy purchases.

If you’re thinking about letting the property out in the future, you should apply for a standard mortgage. This is on the basis of requesting their approval to rent the property when the time comes. This is usually called applying for “consent to let” or “consent to lease”.

Lenders vary in their letting consent policies. Some can be flexible as long as the letting is for a limited period (for example: up to two or three years). Other lenders will only give consent in very specific circumstances.

To give an example: if you’re going to be working abroad for a fixed term, there may be fees involved in either applying for consent to let, or in changing from a residential to a Buy-to-Let mortgage.