Buying a home through shared ownership can be a practical step for many. It lets you part-own and part-rent a property, making housing more affordable. Over time, your circumstances may change, and you might consider a shared ownership remortgage. This option can help you cut costs, buy more of your home, or secure a deal that better fits your needs.
What is a shared ownership remortgage?
A shared ownership remortgage is when you change your existing mortgage deal on a shared ownership home. You might stay with your current lender or move to a new one. The property is still part-owned by you and part-owned by a housing association or provider, but your mortgage terms change.
The main reason people remortgage is to find a better interest rate or a more suitable deal. In shared ownership, there is also the option to buy more shares in your home over time, known as staircasing. This means a remortgage can play a key role in helping you move towards owning more of your property outright.
If you’re new to the concept of part-buy, part-rent, you can read more about what a shared ownership mortgage is and how it works.
Why would you remortgage shared ownership mortgages?
There are several reasons why someone might look at remortgage shared ownership mortgages. Each reason links back to your financial situation and long-term goals.
- Lower monthly payments: If your current deal has a high interest rate, switching could help reduce what you pay each month.
- Switching to a fixed rate: Some homeowners want predictable payments. Remortgaging allows you to lock into a fixed deal.
- Buying more shares: If you’re planning to staircase, a new mortgage can help fund that extra portion.
- Debt consolidation: Sometimes, people remortgage to combine other debts into their mortgage. This needs careful thought as it can increase the repayment term.
In simple terms, remortgaging is about finding a deal that fits your current needs better. It can be a way to save money, gain stability, or take a bigger step towards full home ownership.
How much can you remortgage a shared ownership property for?
How much you can borrow depends on several factors, including your income, credit history, and the lender’s criteria. For shared ownership, lenders will also look at the share you own and the rent you pay on the remaining share.
The good news is that most lenders treat applications in a similar way to standard remortgages, though the housing association’s consent is usually required. This means you can still access a wide range of deals, but the exact amount depends on your personal finances.
For example, if you want to increase your share of the property, the lender will assess affordability based on both the mortgage and the rent you’ll still pay. If your goal is simply to switch to a cheaper deal, then the amount borrowed is likely to match your outstanding mortgage balance.
To understand this better, it helps to look at the meaning of remortgaging and what it involves in everyday terms.
How to remortgage a shared ownership property
When thinking about remortgaging shared ownership, it helps to break the process into steps. While the idea may sound complex, the actual steps are straightforward.
What does it mean to remortgage?
To remortgage means replacing your current mortgage with a new one, either with your existing lender or a different one. In shared ownership, this might be to buy a larger share of your home or to move to a deal that suits you better. When the new loan takes effect, it pays off the old one, and your updated terms begin. A remortgage is simply a change of loan agreement, not a new purchase.
How soon can you remortgage before the fixed rate ends?
Most fixed-rate mortgages run for two, three, or five years. You can start looking for a new deal up to six months before the current one ends. This is because many lenders let you secure a new offer in advance, so it starts as soon as your old one finishes.
If you try to leave earlier, you may face early repayment charges. These can be costly, so it’s usually better to wait until the final months of your fixed deal. By planning ahead, you avoid moving onto your lender’s standard variable rate, which is often higher.
Should I remortgage?
The choice to remortgage depends on your situation. Ask yourself:
- Am I nearing the end of my current deal, and do I want to avoid higher rates?
- Do I have stable finances to support staircasing or bigger repayments?
- Do I prefer predictable fixed payments, or is flexibility more important?
- Would switching lenders give me features I don’t currently have, like the option to make overpayments?
If these questions align with your goals, then remortgaging shared ownership may give you the control and benefits you’re looking for.
Conclusion
Many homeowners wonder, can you remortgage a shared ownership property? The answer is yes, and doing so can be a smart way to cut costs, gain stability, or increase your share of the home. The process includes a few extra steps, like housing association consent, but in most cases, it works much like a standard remortgage.
By reviewing your current deal, planning ahead, and comparing options, you can choose a mortgage that supports your long-term goals. Whether the aim is to save money or move closer to full ownership, remortgaging gives you the flexibility to make your home fit your future plans. For more advice on how to remortgage a shared ownership property, speak with a broker today.