Help To Buy
There is a lot of coverage in the media about the government’s Help To Buy schemes, but it can be confusing as to what the schemes are currently available, what they entail and who is actually eligible. Here is our quick guide to Help To Buy!
Help To Buy Mortgage Guarantee Scheme
The government is backing high loan-value mortgages with participating lenders, which means if you have a 5% deposit you can obtain a 95% mortgage to purchase a property for any property up to the value of £600,000. This scheme works just like any other mortgage, so you will still need to meet the lending criteria. You cannot own any other property, anywhere in the world, and cannot be used in conjunction with any other Help To Buy scheme.
The mortgage guarantee scheme is available to the whole of the UK, but there are other Help To Buy schemes available in England, Wales, and Scotland.
Help To Buy England
The government can lend you up to 20% of the value of your home, meaning you will only need a 5% deposit and can take out a 75% mortgage. This is open to first-time buyers and home-movers for properties up to the value of £600000. However, you cannot own another property when you buy your new home with an equity loan.
Shared Ownership schemes are provided through housing associations. You buy a share of your property (between 25% and 75%) and pay rent on the remaining share. These properties are always leasehold and you will be eligible if your household has an income of £60,000 per annum or less (this is higher in London) or you are a first-time buyer. You will be given priority if you rent a council or housing association property, or you work for the Armed Forces.
Help To Buy Wales
This is a shared equity loan. The Welsh government will provide a loan for up to 20% of the value of the property, meaning you will only need to find a 5% deposit. This is only available for properties worth up to £300,000 and you cannot own another property.
Help To Buy Scotland
This is a shared equity loan. The Scottish government will provide a loan for up to 20% of the value of the property, meaning you will need a minimum deposit of 5%. Your deposit and mortgage combined must equal at least 80% of the value of the property. This is only available for new-build properties with a maximum value of £400,000.