Help to Buy Mortgage Scheme

On 1st April 2013 the Government launched the ‘Help to Buy’ mortgage scheme. If you are looking to purchase a New Build property that is eligible for this scheme we can help you through the process and provide you with mortgage advice. Recently we have seen a lot of new building developments in Evesham and the surrounding areas, and there have been properties in Evesham, Bidford-on-Avon, Honeybourne and other local villages which have been built by developers who are part of the Help to Buy scheme.

The best way to find out about your options when it comes to purchasing your home through the Help to Buy scheme is to just pick up the phone and call us on 01386 800500, or contact us. As we are an independent company we aren’t tied or restricted to certain lenders in the same way that a mortgage adviser in an Estate Agent or a New Build company could be, and so we can offer you mortgage advice on all of the options available to you given your personal requirements and circumstances.

What is the Help to Buy scheme?

The Help to Buy scheme was launched to help first time buyers get onto the property ladder, and also to help those who already have a home to be able to take their next step. There are s few different parts to the Help to Buy scheme, however, the part which we are seeing an increased demand for in Evesham because of the new housing developments being built, is what is called the Help to Buy ‘Equity loan’.

With the Help to Buy Equity Loan, when you can save a 5% deposit for a new home up to the value of £600,000, the Government will contribute up to 20%, which is classed as an interest free loan for the first five years (after which interest is incurred). The Government ‘Equity Loan’ can be repaid in either 25 years or on the sale of the property when you move again, whichever comes first. The amount you pay back to the Government will be based on 20% of the value of your home at that time, so the amount of money you pay back could increase or decrease based on the value of your property. In the meantime, the Government will hold a ‘charge’ on your property as security on the loan.

This means that whereas normally you might struggle to be able to get a mortgage on the property (as 95% mortgages are quite difficult to come by), instead you can take out a mortgage of 75% of the property’s value.

For more detailed information on the Help to Buy Equity Loan and other parts of the Help to Buy scheme visit the Government Help to Buy website.

Am I eligible?

There are a number of criteria for the Help to Buy scheme, but the main points are:

  • You must be looking to buy a property under £600,000
  • You must have a deposit available of at least 5% of the property value
  • The property must have been built by an eligible developer
  • If you already own a property you must be selling that one to purchase the new one – it can’t be used for second homes

To discuss the options with us just give us a call and we can talk you through any information you have and advise you as to whether the Help to Buy scheme could be the right option for you.

What do I need to do?

If you think that Help to Buy might be the best option for you then come and have a chat with us initially. We will go through your situation and your financial position to establish how much you might be able to borrow. At this point we may decide that it would be a good idea to obtain an Agreement in Principal with a lender.

Once you know how much you can borrow, it will give you a much better idea of the value of property that you could afford to buy, and you can move on to the fun part and start to looking around at the properties being built in the area!