HELP TO BUY SCHEME
This comprises of 2 Help To Buy schemes:
- Equity Loan (available now) where the Government will loan you up to 20% of the value of your new build home, and
- Mortgage Guarantee (available from January 2014) where lenders are incentivised to make more mortgages available to people with small deposits and covers all types of property, not just new build.
Equity Loan Conditions:
- You do need to have a minimum of 5% deposit to be eligible for the scheme
- Meet appropriate tests to ensure you can pay back the deposit.
- The maximum property value up to £600,000
- Open to both first time and existing buyers
- Not available for Interest Only mortgages
- Not available for Buy To Let properties
- Not available for Incorporated companies
- The Equity Loan can be repaid at any time or by the end of the term of the mortgage or at the sale of the property.
The loan is interest free for the first 5 years. From year six a fee of 1.75% is payable on the loan, which rises annually by RPI inflation plus 1%
The Government is offering to provide guarantees to lenders on a proportion of the mortgage. If a property is repossessed, the Government will cover a proportion of the losses suffered by the lenders. The Government hopes this will make lenders offer more mortgages for high loan to value properties. It is available for both new build and older properties up to a value of £600,000. It is open to individuals with a deposit between 5% – 20%.
To find out more about the Government Help to buy schemes and how they can help you, why not call us on 01223 329666