This is where the Help to Buy: Equity Loan scheme becomes a more attractive, viable option. This scheme provides new build homes to first-time buyers who would otherwise be unable to access affordable loan to value mortgages, due to not having a big enough deposit.
A deposit of only 5% is required at the point of exchange of contracts, instead of the usual 10%. On top of this, the government lend you up 20% of the purchase price on specified developer’s newly-built homes. These may have a value of up to £600,000.00 (the full property price limit is region-dependent). The scheme is available in England only and applicants must be 18 or older and be a first-time buyer.
It is a reflection of the surging property prices within the capital that the government have increased their lending from 20% to 40% of the purchase price if the property is situated within a London borough.
How do I apply?
The first stage is to contact your local Help to Buy agents who will assess and approve your purchase for Help to Buy. You will need their approval before you can proceed with the buying process. The scheme is available in England from house builders who are registered to offer the Help to Buy scheme.
You will not pay any interest on the government/equity loan for the first 5 years, and then from year 6 you pay monthly interest of 1.75% of the equity loan. Another point to note is that you are required to have a repayment mortgage as opposed to an interest-only mortgage.
How can we help?
Here at Amphlett Lissimore, our specialist lawyers are fully equipped to act on your behalf and can guide you through the conveyancing process. We’ve helped many first time buyers onto the property ladder and are experienced with the Help to Buy: Equity loan scheme. We will also ensure all the necessary checks are completed on your new build property purchase.