…regardless of whether you’re a First Time Buyer or not. We’re currently acting for a number of local developers offering Help to Buy as a purchase option, in assisting buyers with their queries, we’ve identified a number of misconceptions on this Government scheme that we’d like to clear up.
Help to Buy is not just for First Time Buyers
The Help to Buy equity loan scheme (a 20% interest free* loan in addition to your own deposit of at least 5%), was indeed set-up to help get people onto the property ladder, however, it is also there to assist those looking to move up the ladder.
The Government lends you up to 20% of the cost of your newly built home, so you’ll only need a 5-65% cash deposit and a mortgage to make up the rest.
You won’t be charged loan fees on the 20% loan for the first five years of owning your home.
If you already own a home but are looking to move, perhaps you have a growing family and need a bit more space, you can in fact use Help to Buy.
You may be surprised by what you can afford, for instance, if you have a mortgage agreed up to £393,375 and a minimum of a 5% deposit, 2nd hand you’d be looking at a property in the region of £419,600; likely a three bedroom semi-detached home, dependent on your location choice. By using Help to Buy and the additional 20% loan, you could achieve a brand new four bedroom detached house.
By taking the larger step now, you’ll also avoid having to move multiple times, removing the stress and costs attached to that method.
You can use Help to Buy even if you have before
If the home you own now, or previously, was purchased using Help to Buy, there is nothing to stop you using the process again. The only requirement is that you must be selling your existing home, you cannot purchase a 2nd home (for letting out etc).
Help to Buy extends up to £600,000
Many perceive the Help to Buy scheme to apply to apartments or starter homes, this is not the case. If a developer is offering Help to Buy, you can purchase a home up to the value of £600,000 to still benefit from the 20% loan.
It does not matter how much you are earning
Whilst you will need to be achieving a certain salary to get the relevant mortgage offer, there is no cap. Regardless of what you earn, if you can obtain the mortgage offer, you will be eligible for the Help to Buy loan.
You do not need to apply in advance
Help to Buy is a very simple process. Once you find the home you like, you put in an offer with the developer (who must be part of the Help to Buy scheme) and they help you on your way, there is nothing (other than obtaining the deposit and mortgage offer) that you need to do in advance.
There is a great choice of new homes locally that benefit from the Help to Buy boost, we are currently offering one bedroom apartments to four bedroom detached homes; all with Help to Buy available. Click here to see the current options, or get in touch with your local branch to find out more.
*You’ll need to pay a £1 management fee every month until the loan is repaid. The first five years of the Help to Buy equity loan is interest-free. After the interest-free years, you’ll be charged 1.75% on the outstanding amount as interest. This fee will increase each year by RPI plus 1%