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Help To Buy Schemes

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Help to Buy comprises of 2 schemes:

  • Equity Loan:
    where the Government will loan you up to 20% of the value of your newly built home, so you’ll only need a 5% cash deposit and a 75% mortgage to make up the balance
  • Shared Ownership:
    Offers you a chance to buy a share of your home (between 25% and 75%) and pay rent on the remaining share.

Equity Loan Conditions

  • You need to have a minimum of 5% deposit to be eligible for the scheme
  • Not allowed to sublet or use part-exchange on old home
  • You must not own any other property at the time you buy your new build home
  • The maximum property value up to £600,000
  • Open to both first-time and existing buyers

Equity loan example:

Shared Ownership

Shared Ownership allows you to part-buy and part-rent your home from a housing association.
The share of the property you purchase is usually between 25% and 75% (a mortgage can be secured on this percentage of the property) and you rent the remaining share from the housing association.
It is possible to increase your share of the property until you own the entire the property (with or without a mortgage). This process is called ‘staircasing’.

You could buy a home through Help to Buy: Shared Ownership if:

  • Your household annual income is £80,000 or less outside London (£90,000 or less inside London)
  • You are a first-time buyer, or used to own a home but cannot afford to buy one now, or are an existing shared owner looking to move

Help to Buy Remortgage

Is your Help to Buy mortgage product coming to an end? There are ‘Help to Buy remortgage’ deals up to 75% loan to value on the market or if you would prefer to pay back your Help to Buy Government Loan and then remortgage, there are products available up to 90% loan to value.
These are mortgage products available over 2, 3 and 5 years.

Help to Buy ISA

The government is offering the Help to Buy ISA for first time buyers. This allows the ISA holder to earn up to 2.5% interest tax-free and then the government will top-up the account with 25% tax-free cash. This scheme is only available for purchasing a property under £250,000 (£450,000 in inner and outer boroughs of London).

More information:
HelpToBuy.gov.uk – how does it work?
Help to Buy ISA Guide from HMRC

Lifetime ISA (LISA)

You can use a Lifetime ISA (Individual Savings Account) to buy your first home or to save for later life.
You must be 18 or over but under 40 to open a Lifetime ISA (but you can continue to pay in until your 50th birthday). You can put in up to £4,000 each year and the government will add a 25% bonus to your savings, up to a maximum of £1,000 per year. The Lifetime ISA limit of £4,000 counts towards your annual ISA limit which is £20,000 for the 2018-19 tax year.

To open and continue to pay into a Lifetime ISA you must be a resident in the UK, unless you’re a crown servant (for example, in the diplomatic service), their spouse or civil partner.

You can withdraw money from your ISA if you’re:

  • Buying your first home
  • Aged 60 or over
  • Terminally ill, with less than 12 months to live

You’ll pay a 25% charge if you withdraw cash or assets for any other reason.

Contact us to discuss your Help to Buy options

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We are proud to be members of the Equity Release Council, the NACFB, the Later Life Academy and the National Skills Academy