Governments Help to Buy Scheme Explained
The government is considering drafting plans to extend its Help to Buy scheme for new home purchasers, according to reports.
The schemes current deadline is at the end of this year, but an extension is being considered due to delays in UK house building caused by the coronavirus pandemic.
The Help to Buy scheme lets buyers purchase a new build home with a deposit of as little as 5%.
The scheme was first launched back in 2013 and has since helped over 250,000 households buy a new-build home.
Chancellor, Rishi Sunak, is under pressure to ensure that thousands of buyers do not lose their chance to benefit from the scheme due to delays caused by Covid-19.
What is Help to Buy?
The government launched the Help to Buy equity loan scheme to make it easier for first-time buyers to get onto the property ladder.
It is also available to existing homeowners looking to purchase a new build property.
With the government funding a portion of a property’s value, buyers can secure a mortgage with a smaller deposit and will not need to borrow as much from a lender, opening the door to favourable rates and lower monthly repayments.
Save and borrow less – You will only need a 5% deposit and 75% mortgage to secure your dream home.
Government-backed – The government will fund up to 20% of the value of your property with an equity loan.
Flexible repayment – The loan is interest-free for five years and can be repaid at any time without penalty, or upon the sale of your home.
Who is eligible?
- The Help to Buy equity loan scheme is available to first-time buyers and homeowners looking to move.
- The home you wish to buy must be newly built and have a maximum purchase price of £600,000.
- The home must be your only residence.
- The scheme is not available to buy-to-let investors or anyone who will own other property after completion.
Buyers interested in Wavensmere Homes’ development, The Nightingale Quarter in Derby, can benefit from the governments Help to Buy scheme on all house types.