Shared ownership when your credit file is not perfect.

Two costs, and both are assessed

You buy a share of the property and pay rent to the housing association on the share you do not own, usually with a service charge on top. The mortgage only covers your share, which is why the deposit can be small — but the affordability assessment looks at the mortgage payment, the rent and the service charge together.

Both of those costs rise over time, and as the leaseholder you usually pay the full cost of repairs and the service charge however small your share is. Falling behind on the rent can put your share at risk as well as your home, so the rent is a commitment to take as seriously as the mortgage.

That catches people out. A modest mortgage on a quarter share can still be declined on affordability, because the lender is adding a rent you would also be paying. Knowing the rent and service charge figures before anyone applies is the difference between a realistic application and a wasted one.

The lender pool is smaller from the start

Not every lender offers shared ownership mortgages. The ones that do are working with a lease, a housing association and a resale restriction rather than a straightforward freehold, and that is more work. Add adverse credit and the field narrows again — which makes the order of approach matter more here than almost anywhere else on this site.

It is workable. It is not something to approach by applying to your own bank and seeing what happens.

The housing association assesses you too

This is the part that surprises people most. Before the mortgage, the housing association runs its own eligibility and affordability check, and their criteria are not the lender's. You can pass one and fail the other.

They will generally want to see that you cannot afford to buy outright, that you are within the income limits for the scheme, and that the arrangement is sustainable for you. Being straight with them about your credit history at that stage is far better than it emerging later — they are used to it, and a surprise at the referral stage costs weeks.

Staircasing, and why it matters now

Buying further shares later is called staircasing, and each step is priced at the market value at the time, with a new valuation and fees — and if you borrow to do it, it is a fresh lending decision at whatever your circumstances are then. People plan on staircasing as though it is automatic; it is not, and a credit file that is improving makes it considerably more realistic.

Worth thinking about at the outset rather than in five years, because it shapes what share is sensible to buy now.

What to have ready

• The rent and service charge figures for the specific property, not an estimate.
• All three credit reports, with dates and amounts for anything adverse.
• Your deposit, and where it came from — gifted deposits are common here and are fine, with evidence.
• The housing association's eligibility criteria, which vary by scheme and by area.