Help to Buy: How Can It Help You?
10/20/2017 |
In the past four years the Help to Buy scheme has helped more than 200,000 people buy a newly-built home. The scheme now accounts for one in 12 of all first-time buyers making homeownership more achievable for people up and down the UK. If you’re a first time buyer it can be difficult to raise a large deposit to purchase your first home. With Help to Buy you only need just a 5% deposit to get a mortgage.
When Did It Begin?
The first phase started in April 2013 in England. This saw the government begin offering a 20% equity loan to buyers of newly-built properties. When the property is sold, the government reclaims its loan. So if the value of the property has gone up, the government will inherit the capital growth.
In November 2015 George Osborne announced that the equity loan scheme in England would be extended to 2021. Originally it had been due to end in December 2016.
How Does It Work?
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You provide a 5% deposit
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The government will provide an equity loan of up to 20% of the value of your property
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You obtain a 75% mortgage
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The equity loan is interest free for the first five years
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You repay the Help to Buy equity loan (it can be repaid at any time or on the sale of your home)