Remortgaging a shared ownership home with adverse credit is often possible, although shared ownership adds its own layer on top of the usual credit checks. You only own a share of the property and pay rent on the rest, your housing provider generally needs to agree to the remortgage, and fewer lenders offer shared ownership mortgages in the first place. Adverse credit narrows that smaller field further, but it does not rule it out.
This page explains how remortgaging your share works, what your housing provider needs to agree, and how bad credit fits in alongside staircasing and fewer lender choices. If you are struggling with the rent or mortgage payments, free help is available from MoneyHelper, StepChange and National Debtline.
On this page
In short
- You remortgage your own share of the home, not the whole property, and your housing provider usually needs to agree.
- Fewer lenders offer shared ownership mortgages, and adverse credit narrows that pool further.
- Staircasing, buying more of your home, can often be done alongside or separately from a remortgage.
- Rent on the unowned share and any service charge count towards your outgoings when a lender checks affordability.
Your home may be repossessed if you do not keep up repayments on your mortgage. Think carefully before securing other debts against your home. Borrowing over a longer term can mean paying back more in total.
Does your housing provider need to agree?
Usually, yes. Your lease sets out the terms of your shared ownership arrangement, and your housing association or council as landlord generally needs to be told about, or agree to, a remortgage of your share. Some leases require formal consent before a new lender can register its charge; others simply need to be notified. Check your own lease, because the process varies between providers.
Build extra time into your plans for this step, particularly if your current deal is close to ending, and contact your housing provider early so any consent or paperwork does not hold up your remortgage.
- Your lease and the section covering remortgaging or changes to your mortgage
- Contact details for your housing provider and any previous correspondence
- Your current mortgage deal end date, so you know your timescale
How does staircasing fit alongside a remortgage?
Staircasing means buying a further share of your home from your housing provider, moving you closer to owning it outright. It uses a current valuation of the property to work out the cost of the extra share, and it can be done at the same time as a remortgage or separately from it.
| Option | What it involves | Effect on your mortgage |
|---|---|---|
| Remortgage only | A new deal on your existing share, with the same lender or a new one | Your share and rent stay the same; only the mortgage rate or lender changes |
| Staircasing only | Buying more of your home from your provider, based on a current valuation | Your rent usually reduces; your mortgage may need to be reassessed if it changes size |
| Both together | Remortgaging to help fund staircasing, or staircasing that triggers a new deal | Assessed together; a lender will check affordability for the full new amount |
General descriptions only, not lender or provider terms. Ask your housing provider about the process and any fees.
Some homeowners staircase specifically because owning a larger share, or the whole home, widens the choice of lenders on a future remortgage. Others simply want to reduce the rent they pay on the unowned share.
What if you want to raise money or consolidate debts?
Because you only own a share of the property, the equity available to release through a remortgage is usually smaller than on a home you own outright. Lenders still assess it in the normal way, looking at your share’s value, what you owe, and your income.
If you remortgage to clear other debts, they become secured against your share of the home, and your home may be repossessed if you do not keep up repayments. Spreading debts over a longer term can also mean paying more in total. Read about debt consolidation remortgages before deciding.
What may affect a shared ownership remortgage with bad credit
| Factor | Why it matters |
|---|---|
| Housing provider consent | Your lease sets out what your provider needs to agree to or be told before you remortgage. |
| Size of your share | A larger share generally means more lenders may consider you, with or without credit issues. |
| Rent and service charge | Both count as outgoings when a lender checks affordability alongside your mortgage payment. |
| Recent staircasing or plans to staircase | Buying more of your home can change the amount and terms a lender will assess. |
| Type and age of credit issues | Recent or unresolved problems narrow an already smaller pool of shared ownership lenders. |
| Mortgage and rent payment history | A clean recent record on both generally helps, even where older problems appear on your file. |
| Equity and loan to value on your share | A lower LTV on your share generally widens options. |
| Purpose of the borrowing | A like-for-like switch is usually simpler than raising money or funding staircasing. |
| Income and affordability | Lenders check your income and outgoings and stress test any higher payment. |
These are general points, not lender rules. Each lender sets and changes its own criteria.
Information an adviser may ask for
You don’t need all of this to make an enquiry. It helps to know where to find it, because an adviser is likely to ask about most of it.
- A copy of your lease and any staircasing or consent correspondence
- Contact details for your housing provider
- Your current mortgage balance, deal end date and any early repayment charges
- Your monthly rent and any service charge
- Your credit reports from Experian, Equifax and TransUnion
- Details of any CCJs, defaults, missed payments or arrears, with dates
- Proof of income and a summary of your regular outgoings
Specific situations
More detail for particular circumstances.
Staircasing your shared ownership home with bad credit
How staircasing works, from valuation to purchase, how it is usually funded through a remortgage, and how bad credit affects the larger amount you may need to borrow.
Frequently asked questions
Can I remortgage my shared ownership home with bad credit?
Often, yes. Fewer lenders offer shared ownership mortgages in the first place, and adverse credit narrows that field further, but it does not usually rule it out. Being open with an adviser about both your share and your credit history helps them find lenders that may fit.
Do I need my housing provider’s permission to remortgage?
Usually you need to tell your provider, and some leases require formal consent before a new lender can register its charge. Check your own lease, because the exact process varies between housing providers.
Can I remortgage and staircase at the same time?
Often, yes. Some homeowners remortgage specifically to help fund buying a further share, while others staircase first and remortgage afterwards. A lender will assess affordability for the full amount either way, so speak to your provider and an adviser about the order that suits you.
Will a CCJ or default stop me remortgaging my share?
Not necessarily. Lenders look at how old the CCJ or default is, whether it is settled, and how it fits with your income and outgoings, including your rent. Because fewer shared ownership lenders exist, a recent or unresolved problem can narrow choice more than on a standard remortgage.
Can I release equity from my shared ownership share?
It may be possible, but the equity available is usually smaller than on a home you own outright, because you only own part of it. Lenders assess it in the normal way, looking at your share’s value, what you owe and your income.
What happens to my rent if I staircase?
Buying a further share usually reduces the rent you pay on the part you no longer rent, based on the terms in your lease. Ask your housing provider exactly how your rent would change before you commit to staircasing.