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‘Shared-ownership deals lack logic’

Brokers believe Halifax’s intermediary-only shared ownership scheme is “illogical” due to newbuild lending restrictions.

Halifax for Intermediaries recently launched its latest affordable housing product range, including a shared-ownership product with reduced fees up to 90 per cent loan to value.

But the lender has a loan-to-value limit of 80 per cent on newbuild properties, meaning the shared-ownership loans will be capped on a new property.

Savills managing director Mark Harris says the range is “a waste of time” if it is not going to offer the same benefits on newbuild properties as it would on older properties.

He says: “The vast majority of shared-ownership schemes are newbuild so it says it lends at 90 per cent in that sector but this is an example of spin rather than facts.”

John Charcol senior technical manager Ray Boulger says: “Halifax’s stance is somewhat illogical. In the past, it was sensible for lenders to cap lending on newbuilds due to the rise in fraudulent valuations but now they are aware of past problems and should assess each case accordingly.

“By their definition, equity share mortgages already have a safe equity cushion in the form of the third party’s share.”

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