What are the Key Risks?
You will be obliged to purchase the property at the end of the lease unless we waive this obligation. We may agree to do so in certain circumstances (e.g. where you demonstrate you cannot afford to purchase the property) we will waive in line with our Waiver Policy published below.
There is no guarantee you will be eligible for a 95% mortgage to buy your chosen property from HomeNow after your Home Purchase Plan (HPP) term has expired, in these circumstances you are unlikely to move into home ownership unless we extend or revise the terms of your HPP, this may not be possible.
The value of the property bought under the HPP may not increase as we expect, or may even decrease over the term of your HPP meaning there is no uplift in value to share with you. If this means you don’t have enough money to fund a deposit to purchase the property, we have discretion as to whether to require you to proceed with the purchase, whether to sell to someone else, or whether to extend the term of the lease in the hope that the property will become affordable for you in the future. In certain circumstances you may end up paying more than if had you rented and saved over the same period.
In circumstances where you are eligible for a 95% mortgage and do not purchase the property we will enforce the obligation.
If you don’t keep up rental payments, your home may be repossessed.
The price you must buy the property at will be the market value at the end of the HPP. This is likely to be higher than today’s prices.
A Summary of Our Waiver Policy
It is our policy that, subject to evidence being provided to our satisfaction that you are subject to certain extenuating circumstances (which are detailed in your Home Purchase Plan) and you are not able purchase the Property at the end of the Term this plan, we will waive your obligation to do so.
Following such waiver:
- We shall seek to understand whether you wish to sell the property, extend the agreement term or walk away and will seek to accomodate this where we are able to do so.
- If we sell the Property to a third party above a price agreed with you, we will pay you a Rental Refund in cash following the completion of the sale (subject to you remaining in the property and continue to meet all other obligations outlined in your agreement until sale)
- If we extend the Home purchase, the extension shall be on terms that you continue to reside in the Property and pay the your rent for the extended term.
Where you fail  to cooperate in good faith with us to assess the existence of these circumstances or you have otherwise acted in bad faith and breached the terms of any of our agreements, we reserve the right not to waive your obligation.