mortgage-guaranteeYou may have seen in the news that the very popular Help To Buy scheme is undergoing some rigorous changes.

December 2016 will be the last chance to take up the mortgage guarantee scheme, offering buyers the opportunity to purchase a home up to £600,000 with a 5% deposit.

The scheme works the same as any other mortgage, except that in this case, the Government offer the lenders the opportunity to purchase a guarantee on mortgage loans, meaning the lender can offer more high value-to-loan mortgages. By putting down a 5% you will have to repay a 95% mortgage.

Since the launch of the mortgage guarantee scheme, over 74,000 mortgages have completed using this support, with 79% being first time buyers.

pigg-bank-2In essence, this has encouraged lenders to approach high value-to-loan mortgages with pleasure, where they may have previously approached with caution. The removal of this scheme could dishearten buyers, in particular those striving to save to get on the property ladder for the first time.

However, the removal of the mortgage guarantee scheme is certainly not the end of the world for those with a 5% deposit, some would say that the scheme allowed mortgage lenders to “test the water” with regards to 95% loans, who are potentially now more confident in offering this level of mortgage without the Government guarantee. It is definitely worthwhile chatting to an independent advisor to see what options are currently, and will be, available to you.

The successful Help To Buy equity loan scheme will continue into 2017, along with the Help To Buy ISA, so it is far from doom and gloom for first time buyers, you may just need the confidence of some expert advice to achieve the best mortgage deal available.

Andrew Fagg Mortgage AdvisorAndrew Fagg, a specialist mortgage advisor at Davenport, has worked with us for over 20 years and is based out of our Fleet branch to provide the best possible service for our clients.

He will offer advice on the many options available across the market and is on hand to help and guide you through the process, a great lifeline for those of you who might be new to all of this!

Andrew can offer a free mortgage consultation to discuss which mortgage and scheme (if applicable), might suit you best.

For further information, and to discuss your mortgage options, please call 07720 353866, or click here to email.