Think carefully before securing other debts against your home. Your home may be repossessed if you do not keep up repayments on your mortgage or any other debt secured on it.
Tenants across England can get up to £77,900 off the cost of buying their council home through the scheme. The maximum discount in London is £103,900.
To be eligible for the Right to Buy discount scheme you will need to have been a public sector tenant for at least three years; this means your landlord would have to be a council, NHS trust or housing association.
This three years does not have to be in one continuous period or just in the home you want to buy. However, the property has to be your only home and it has to be self contained.
You cannot apply for a Right to Buy discount if any of the following apply:
The property is not your main home
The property is not self-contained (i.e. you share a kitchen or bathroom)
You have an introductory tenancy rather than a secure tenancy
There is a court order saying you must leave your home
You have an undischarged bankruptcy
You are being declared bankrupt
You owe money to creditors
Certain properties are also excluded from the Right to Buy scheme, usually if they are reserved for the elderly or for tenants who work in a specific public sector, such as firemen or the police.
However, if you live in an ex-council house that was sold to another landlord, a "Preserved Right to Buy" may still apply.
You can find out if you could buy your property through the scheme, using the GOV.UK website.
You can apply jointly with someone you share your tenancy with or one to three family members who have lived with you in the past year.
The maximum discount available through the Right to Buy scheme has increased to £77,900 for properties across England (£103,900 in London boroughs).
The exact amount you will get will depends on how long you have been a council tenant, whether you live in a flat or house and the value of the property you want to buy on the open market.
The maximum discount for a council flat is 70% of the market value, but the discount starts at 50% for those who have been council tenants for 3- 5 years and increases by 2% for each additional year of council tenancy up to the maximum of 70%.
The maximum discount for a council house through the Right to Buy scheme is 70% of the market value starting at 35% if you have been there between 3 and 5 years and increasing by 1% for every year you have been a council tenant.
Regardless of how long you have lived in your home, or how much it is worth on the open market, the maximum discount on offer through the Right to Buy scheme is £77,900 (£103,900 in London). The maximum amounts increase with the consumer price index in April each year.
The amount of money that will be deducted from your property could be capped by the Cost Floor rule.
This rule allows your landlord, in most cases your local council, to claim back money they have spent on repairing and maintaining your property over the past 15 years from your Right to Buy discount - even if you have not lived there the entire time.
If you want to benefit from the Right to Buy discount and are a qualifying tenant you can start your application by downloading and completing the RTB1 application form.
You will then need to send your application to your landlord who will have four weeks to tell you if you can buy your home (eight weeks if they have been your landlord for five years or less).
If your landlord is happy to sell you your home they will then send you an offer through a Section 125 notice. This will contain a formal valuation of your property including the price you will be expected to pay.
It will also set out details of the property, any known problems, the new Right to Buy discount rates and estimates of any charges that will be deducted from your discount.
Once you receive your Section 125 notice you will have 12 weeks to accept the offer or reject it and continue renting your home.
You can ask for an independent valuation from HM Revenue & Customs if you feel the property value has been set too high. To do this, you will need to write to your landlord within three months of receiving the offer to explain why you think it is too high.
Purchasing your home through the council Right to Buy scheme is very similar to buying a property on the open market, except the home owner (in most cases the council) is able to offer a substantial discount on the price you have to pay.
However, this does mean that you will need to apply for a mortgage and put down a deposit unless you have the cash to purchase the property outright.
Many lenders offer mortgages specifically tailored to Right to Buy applicants, although you should carefully consider all you different options when looking for the best mortgage.
You could also complete our mortgage broker form to speak to an independent mortgage broker in your area.
Many mortgage lenders will let you use your Right to Buy discount as your deposit, meaning you will not need to save a deposit yourself. However, some lenders may still expect you to put down a deposit as well.
If you purchase your home through the Right to Buy housing association you may have to repay some or all of your discount if you sell it again within ten years.
The amount you would have to pay back depends on how long you have owned the property when you sell:
Less than a year = all of the Right to Buy discount
1-2 years = 80% of the discount
2-3 years = 60% of the discount
3-4 years = 40% of the discount
4-5 years = 20% of the discount
5+ years = 0% of the discount
The market value of your home when you sell will also affect the amount you would have to pay back; this applies whether your property has increased or decreased in value.
For example, if your home was worth £100,000 and you got a discount of £40,000 only to sell it for £110,000 the discount would be calculated as £44,000.
So if you sold it 30 months after purchase you would repay 60% of £44,000.
You also have to give your original landlord first refusal on the property and offer it to another social landlord in the area if you sell it within ten years.
Control over social housing is a devolved issue, meaning that the governments of Scotland, Wales and Northern Ireland have control over their Right to Buy schemes.
The maximum discount you can get is:
£8,000 in Wales
£24,000 in Northern Ireland
The Scottish parliament withdrew the scheme entirely in Scotland on 31st July 2016.
You can find more information on the Right to Buy scheme in Scotland.
To a large extent the rules governing Right to Buy discounts are the same in Wales as they are in England, however the maximum discount available in Wales is much lower at £8,000.
Additionally the Welsh Assembly has given powers to local authorities to suspend the Right to Buy programme in areas where they are short of social housing.
This means that you may not be able to purchase your home if your local area has suspended the programme.
For more information on the Right to Buy Wales scheme, visit the Welsh Government website.
While the Northern Ireland Right to Buy scheme allows Housing Executive and housing association tenants to purchase their home at a discount, the maximum discount available in Northern Ireland is £24,000.
Most of the other rules and regulations regarding the scheme are the same as in England, with tenants having to have been a tenant for a minimum of five years to qualify.
For more information and details of how to apply, visit the Housing Rights Service website.
If you're a first time buyer or looking to move house or remortgage, we can help you find the best mortgage deal to suit your needs.