Best right to buy mortgage deals

What is a right to buy mortgage?

A right to buy mortgage is designed for people who want to buy their council or housing association home using the government’s Right to Buy scheme. The discount you receive through the scheme can often be used as part, or sometimes all, of your mortgage deposit.

The amount of discount you get depends on where you live, how long you’ve been a tenant, and whether your home is a house or a flat.

Even though you’re getting a discount, you’ll still need to apply for a mortgage and show that you can afford the repayments.

Why choose a right to buy mortgage?

Right to Buy can be a great way to get a foot on the property ladder, and you may not have to save a deposit as many Right to Buy lenders will treat the discount as a deposit. However, your choice of lenders may be limited as not all mortgage providers offer this type of mortgage.

The type of property you’re buying may also affect which mortgages you’re eligible for. Some Right to Buy mortgage providers, for example, may not be willing to offer mortgages on high-rise flats.

L&C can advise which lenders will be able to help you so you can secure the best mortgage deal for your needs.

How the right to buy scheme works

To qualify, you must have been a public sector tenant for at least three years. This doesn’t have to be in the same property or with the same landlord. Once you’ve applied to buy your home, your landlord will confirm if you’re eligible and tell you how much you can buy it for with the discount applied.

Once you know the purchase price, you can start your mortgage application. Many people use the discount as their full deposit, but this depends on the lender’s criteria.

If you sell your home within five years of buying it, you’ll usually have to pay back some or all of the discount.

Who can get a right to buy mortgage?

To get a right to buy mortgage, you’ll need to meet standard affordability checks. That means showing you can afford the repayments, even if interest rates go up.

There are some specific Right to Buy eligibility criteria you must meet before taking on this type of mortgage. These include:

• You must be living in the property as your main home
• The property must be self-contained, meaning you don’t share any rooms with people outside of your household
• You’re a secure tenant with a legal contract between you and the landlord
• You’ve had a public sector landlord, like the council, for at least three years - although this doesn’t have to be three years in a row
• You haven’t had any county court judgements or other legal issues with debt

If you’re self-employed, you’ll also need your tax returns or business accounts.

If you live with someone else, you can make a joint mortgage application if they share your tenancy, are a spouse or civil partner, or if they’re a family member who’s lived with you for the past 12 months - even if their name isn’t on your tenancy agreement.

With this type of mortgage, the discount is usually used as your Right to Buy deposit, so the mortgage deals you’re entitled to won’t depend on how much deposit you have saved, unlike regular mortgages. However, in some cases, lenders may require you to provide some of your own deposit too.

How to find the best right to buy mortgage deals

It’s important to compare deals before making a decision. Some lenders offer special right to buy rates, while others may give you a standard mortgage deal depending on your discount and deposit.

We work with over 90 lenders, and our advisers can help you find the most suitable mortgage for your situation. Use our best buy tables to check today’s top rates, then apply online or speak to a friendly adviser to take the next step.

Making repayments on a right to buy mortgage

Your monthly repayments will depend on the mortgage rate, the amount you borrow, and how long your mortgage lasts. Fixed rate deals can offer peace of mind by keeping your payments the same for a set period. Variable rates might start lower, but they can go up and down.

Whatever option you choose, we’ll help you understand what to expect each month so you can feel confident about your decision.