When a house is for sale, what does "equity share" mean?
Asked on Feb 18 2014,
General in Bootle |
It means that you are only purchasing a certain % of the property, so you will not own 100% of the property.
Answered on Feb 18 2014,
On the most basic level, equity share means that you will buy a portion of the house rather than the full 100 per cent of it. The other share will normally be owned by a developer or a housing association, for example. Schemes like this are typically run as a way to get people onto the housing ladder when they cannot afford to buy a home outright.
What equity share means for a buyer is that you will have to come up with a deposit and mortgage for your portion of the house and prove that you can keep up with the payments on this. As well as your mortgage repayments, though, you will also be required to make rental payments to whoever owns the rest of the house. This is scaled down dependent on how much of the home you own.
Typically with shared equity, you will also be able to buy additional shares throughout the time you live there so you can eventually build up to owning the home in full over time, as long as the other equity owner is prepared to allow you to do this.
Answered on Feb 21 2014,
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