Shared Ownership: Remortgage & Further Borrowing

One of the biggest benefits of Shared Ownership is that it can make homeownership more affordable by allowing you to buy a share of a property and pay rent on the rest. As your circumstances change, you may want to review your mortgage, switch to a new deal or borrow additional funds.

This guide explains the difference between remortgaging and further borrowing, when approval is needed, and how the Shared Ownership application process works.

Please note that this article is intended as general information about the Shared Ownership remortgaging and further borrowing process. It is not financial or mortgage advice. If you're considering remortgaging or borrowing additional funds, you should speak to a mortgage adviser or lender to understand the options available to you and whether they are suitable for your circumstances.

What’s the difference between remortgaging and further borrowing?

Remortgaging means replacing your current mortgage with a new one, either with your existing lender or a new lender. Many shared owners choose to remortgage when their fixed-rate deal is ending or when they want to switch to a different mortgage product.

If your new mortgage amount is less than your original mortgage balance, it's considered a remortgage.

If you're borrowing more than your original mortgage amount, this is known as further borrowing.

Can you remortgage a Shared Ownership property?

Yes, you can remortgage your Shared Ownership property, provided the new lender is one that meets the requirements of your Shared Ownership lease and the new mortgage meets the requirements set out in your lease.

Your Shared Ownership provider will need to review and approve the mortgage offer before the remortgage can be completed.

You may decide to remortgage your Shared Ownership property if you: 

• have found a mortgage product that better meets your needs
• are coming to the end of your current fixed-rate deal
• want a mortgage product that's a better fit for your needs.

You can usually start looking at your remortgage options before your fixed-rate deal ends. Your mortgage lender can tell you how far in advance you can get started.

How to remortgage a Shared Ownership home

To apply for a remortgage, you'll need to:

• complete an application form
• provide your current mortgage redemption statement
• provide your new mortgage offer
• pay an administration fee.

Once we've received your application, we'll review your documents to make sure the mortgage meets the necessary requirements.

If your application is approved, we'll complete the paperwork required by your lender and return it to your solicitor. Your solicitor will then manage the completion process and arrange for any funds to be released.

If you're already an Abri shared owner, you can find more information in our Shared Ownership Remortgaging and Further Borrowing Guide.

What is further borrowing?

Further borrowing is when you increase your mortgage above the amount originally borrowed to buy your Shared Ownership home.

Unlike a standard remortgage, further borrowing requires additional approval because it increases the amount secured against your property.

Further borrowing is generally only approved in specific circumstances, such as:

• carrying out essential repairs or maintenance to your home (rather than making cosmetic improvements)
• buying out a partner's share through a transfer of equity
• purchasing additional shares in your home through staircasing.

Each application is assessed individually before a decision is made.

How much can you further borrow with Shared Ownership?

If you’re approved for further borrowing, the maximum borrowing that may be permitted will depend on your lease, lender requirements, property valuation and your Shared Ownership provider's approval process. In many cases, borrowing is capped at a percentage of the value of the share you own.

For example: 

If you own a 50% share of a property worth £200,000, your share is worth £100,000. 

If you could borrow up to 95% of £100,000, giving a potential further borrowing limit of £95,000, this would represent the maximum borrowing calculation based on a 95% loan-to-value limit, subject to lender affordability checks, valuation and approval requirements.

If your property's value has changed since you bought it, this will be reflected in the calculation. Your provider will use a RICS valuation to work out the maximum amount you can borrow based on the value of your share.

How to apply for further borrowing

As with remortgaging, you’ll need to:

• complete an application form 
• pay an administration fee. 

And you’ll also need to provide the relevant documents, including: 

• certified identification 
• your current mortgage redemption statement 
• your new mortgage offer. 

If you're applying for further borrowing, you'll also need a RICS valuation showing the current market value of your Shared Ownership home. The valuation report must include all the information required by your provider to assess your application. 

At Abri, we’ll ask for: 

• the surveyor’s name and surveying firm 
• the surveyor’s signature or signature number 
• the surveyor’s RICS/FRICS registration number 
• the building insurance rebuild value 
• the property’s open market rebuild value. 

If you're borrowing funds for repairs or maintenance, you'll also need to provide supporting evidence explaining why the work is required. 

If your application is approved, your Shared Ownership provider should complete the necessary documentation for your solicitor and lender so your further borrowing application can move forward.

Important things to remember when remortgaging or further borrowing

Before you apply, it's worth keeping the following in mind:

• Remortgaging and further borrowing are different processes with different approval requirements.
• Further borrowing is only available in certain circumstances.
• You'll need to budget for administration, legal and lender fees. 
• Applications can only be completed once all required documents have been received.

Shared Ownership Remortgaging FAQs

Do I need permission to remortgage?

Yes. Your Shared Ownership provider will need to approve your remortgage because they have a financial interest in your home. As part of the process, they'll review your new mortgage offer before giving consent.

Can I borrow more when I remortgage?

Yes. However, if you're borrowing more than your original mortgage amount, this is classed as further borrowing and will require additional checks and approval.

How do I calculate how much I can further borrow against my Shared Ownership home?

As an illustration, some applications are assessed using a maximum loan-to-value percentage of the share you own. The amount available to you will depend on factors including the property valuation, lender criteria and approval requirements.

 

Please note: Mortgage lending criteria and Shared Ownership lease requirements can vary. Always check the terms of your lease and speak to your lender, solicitor or mortgage adviser before making any decisions about remortgaging or borrowing additional funds.