Updated: March 24, 2022

Right to Buy Mortgages

Considering a Right to Buy mortgage? Or looking to remortgage your existing Right to Buy property? It can all be done! Find out how to do it in our expert guide!

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Pete Mugleston

Author: Pete Mugleston - Mortgage Expert

Updated: March 24, 2022

Right to Buy is a government scheme designed to help council tenants buy the home they currently rent. You can get a large discount on the market value of the property, if you meet certain eligibility requirements.

Just like most other homebuyers, you’ll probably need to get a mortgage to buy your home through the scheme. This can be a new and daunting process, but we’ll explain it simply and thoroughly in this guide, which explains how the scheme works, how to navigate it and where to get professional advice about Right to Buy mortgages.

The topics we’ll cover are…

What is a Right to Buy mortgage?

There is no specific mortgage designed for Right to Buy property purchases, so you’ll be choosing from the same range of products as any other buyer. However, almost half of all lenders will not consider these applications. With that context, a Right to Buy mortgage is any mortgage from a lender that does consider these applications.

Given that your choice of mortgage providers will be limited if you’re using the scheme, seeking professional advice before you get started is recommended

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Eligibility requirements

To buy through the Right to Buy scheme, the property must be your only home and must be self-contained (i.e. it must not share facilities, such as a bathroom, with other units). You must:

  • Be a secure tenant of a Right to Buy landlord in England (typically a district council, county council, or London borough council)
  • Have been a public sector tenant for at least three years (not necessarily continuously)
  • Have no outstanding legal issues with debt, including bankruptcy, possession orders, or credit agreements

To pay for the property, you’ll also need to be eligible for a mortgage. Different lenders have different criteria for this, but some of the common requirements are:

  • Enough income to meet the affordability requirements (most lenders offer mortgages based on 4.5 times your salary)
  • A good credit history
  • A maximum age of 70

Don’t panic if you don’t meet these criteria, as there are lenders who cater to all types of applicants. It’s possible to find low-income mortgages, bad credit mortgages, and mortgages for older borrowers, but you need to know where to look for them.

In any of these cases, we’d recommend you speak to a broker. They’ll be honest with you about your chances of success, tell you what steps you should take before applying for a mortgage, and identify the lenders who’ll consider your application.

How to get a Right to Buy mortgage

If you qualify for the Right to Buy scheme, getting a mortgage is achievable in just three steps.

Step 1: Complete an RTB1 form

Complete the form, entitled ‘Notice claiming the Right to Buy’, and submit it to your landlord (keeping a copy for yourself and asking for a receipt). You’ll need to provide details of:

  • The property you’re buying and your current landlord
  • Your identity and anyone else named on the tenancy agreement
  • Any family members who will share the Right to Buy
  • Your previous public sector tenancies
  • Any previous discounts you’ve received under government home ownership schemes
  • Improvements you’ve made to the property that could affect its valuation

Your landlord will respond with an offer notice that lists:

  • The full market value of the property, according to their valuation
  • The discount you’re entitled to, based on the information you provided
  • The discount price you’ll pay for the property, which you’ll need a mortgage for
  • Any structural problems they’re aware that the property has
  • Any terms and conditions related to the offer and the property sale

Step 2: Find the right lender

Now that you know how much you need to borrow, you can identify the right lender for your circumstances. While you can approach your current bank, they won’t necessarily accept Right to Buy applications, and you might not meet their eligibility requirements. They also might not offer the best deal – you won’t know unless you shop around.

The best way to shop around for deals is to work with a broker who has access to the entire market. They will identify every mortgage that’s available to you and compare not just the rates but the total costs over the term of the loan, to help you choose which is right for you.

An expert in Right to Buy mortgages can help to guide you through the process and look out for things that you might miss – such as whether you should appeal your landlord’s valuation. They’ll also help you with your application and ensure you submit the right documents.

Step 3: Make your application

Finally, you’ll need to apply to your chosen lender. As with any mortgage application, you’ll need to supply:

  • Your personal information
  • Details of the property you’re buying
  • Proof of your monthly income
  • Details of loan repayments
  • Bank statements as evidence of your outgoings

For Right to Buy application specifically, you should also provide:

  • A copy of your RTB1 form
  • Proof of the discount you’re entitled to
  • A reference from your landlord or evidence of paying your rent

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The cost of buying and the discount you’ll get

Right to Buy makes owning your home far more affordable than it would be otherwise, by selling it to you at a discounted price. The discount you’ll be entitled to depends on:

  • How long you have been a public sector tenant (the percentage discount increases every year after five years, to a maximum of 70%)
  • Whether the home is a house or a flat (flats are more heavily discounted)
  • The value of your home (as the total discount is capped at £84,600, or £112,800 in London)

The table below illustrates the cost of buying a property in London valued at £200,000, with various levels of discount:

Years as a public sector tenant Discount (house) Price you’ll pay (house) Discount


Price you’ll pay (flat)
3 35% £130,000 50% £100,000
4 35% £130,000 50% £100,000
5 35% £130,000 50% £100,000
6 36% £128,000 52% £96,000
7 37% £126,000 54% £92,000
8 38% £124,000 56% £88,000
9 39% £122,000 58% £87,200
10 40% £120,000 60% £87,200

How much you can borrow

Many Right to Buy mortgages allow you to borrow 100% of the discounted price of your home. The discount becomes equity in your property and essentially serves as the deposit. You may even be able to borrow more than 100% if you intend to spend money on repairs and home improvements once you’ve bought the property.

However, the amount you can borrow doesn’t only depend on the discounted price of your home but also on the lender’s independent valuation. For Right to Buy applications, most lenders cap the financing available at 75% of their valuation.

For example, if they value your property at £200,000, they’ll usually lend a maximum of £150,000. This means that:

  • If the discounted price of your home is £130,000, you should be able to borrow £130,000
  • If the discounted price of your home is £130,000 and you have planned home improvements costing £10,000, you might be able to borrow £140,000
  • If the discounted price of your home is £160,000 (because your landlord’s valuation is much higher than the lender’s valuation), you’ll still be able to borrow £150,000. You’d need to find £10,000 in cash – or appeal the valuation.

Things to consider

Before beginning the process of buying your home, you should be certain that this move is in your best financial interests. Though there are many advantages to owning your own home, you also need to be aware of the following:

  • As a homeowner, you’ll be ineligible for housing benefit
  • You will be responsible for any costs related to the upkeep and repair of your home
  • Your costs might also include buildings insurance, service fees and ground rent
  • Interest rates could change, which could increase your mortgage payments
  • If you can’t make your mortgage repayments, you could lose your home
  • The market value of your home could go down after you buy it
  • If you sell your home within five years, you’ll need to repay a portion of the discount you received.

It’s a huge decision to make, so it makes sense to seek advice from every available source. You can contact your landlord, read information from the government, speak to your local Citizens’ Advice Bureau, call the Money Advice Service, and speak to a broker.

Getting advice from a specialist Right to Buy mortgage broker

If you’d like to speak to a broker who understands the complexities of Right to Buy mortgages and can answer your questions, you can use our broker-matching service to schedule a free, no-obligation chat.

First, we’ll take a few details from you to determine which of the numerous Right to Buy specialists we work with is best able to help you. Just make an enquiry online or call us on 0808 189 0463 to get started.


Can I get a Right to Buy mortgage with bad credit?

Often, yes. It depends on the severity and recency of your credit issues. Speak to a broker who specialises in bad credit mortgages to find out which lenders will still consider your application. The broker may recommend you take steps to improve your credit rating before you apply.

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Pete Mugleston

Pete Mugleston

Mortgage Expert

About the author

Pete, an expert in all things mortgages, cut his teeth right in the middle of the credit crunch. With plenty of people needing help and few mortgage providers lending, Pete found great success in going the extra mile to find mortgages for people whom many others considered lost causes. The experience he gained, coupled with his love of helping people reach their goals, led him to establish Online Mortgage Advisor, with one clear vision – to help as many customers as possible get the right advice, regardless of need or background.

Pete’s presence in the industry as the ‘go-to’ for specialist finance continues to grow, and he is regularly cited in and writes for both local and national press, as well as trade publications, with a regular column in Mortgage Introducer and being the exclusive mortgage expert for LOVEMoney. Pete also writes for OMA of course!

FCA Disclaimer

*Based on our research, the content contained in this article is accurate as of the most recent time of writing. Lender criteria and policies change regularly so speak to one of the advisors we work with to confirm the most accurate up to date information. The information on the site is not tailored advice to each individual reader, and as such does not constitute financial advice. All advisors working with us are fully qualified to provide mortgage advice and work only for firms that are authorised and regulated by the Financial Conduct Authority. They will offer any advice specific to you and your needs.

Some types of buy to let mortgages are not regulated by the FCA. Think carefully before securing other debts against your home. As a mortgage is secured against your home, it may be repossessed if you do not keep up with repayments on your mortgage. Equity released from your home will also be secured against it.

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