Inside Housing reported on a case involving the prospective owner of a shared ownership property being advised to ditch a travel loan and pension contributions in order to boost their chances of meeting the affordability criteria for the purchase.
Emails between the sales person from the shared ownership landlord, Notting Hill Genesis, and the buyer were seen by Inside Housing.
The email stated that the shared ownership flat would be “unaffordable” so long as the buyer was paying towards a season ticket loan and contributing to a self invested personal pension (SIPP).
According to Inside Housing, it continued: “The only way to make the property affordable is to pay off the season loan and also the SIPP. If you are not in the position to pay this off, we have to offer the flat to the next person on our waiting list, please confirm by close of business today.”
A spokesperson for NHG said the advice had been offered in “good faith” but accepted that sales staff should not be “offering financial advice or urging potential customers to make any specific financial decisions”.
The Financial Conduct Authority confirmed that firms should be wary of offering advice to shared ownership buyers since they could be in breach of the Financial Services and Markets Act. Only firms with the correct authorisation, or who are exempt, are allowed to offer advice on regulated areas like loans and pensions.
