Help to Buy is a government funded scheme to assist UK residents with purchasing their own, new-build home. If you are unable to fund a large percentile deposit, the Help to Buy Scheme can make purchasing your own home more affordable through a 20% equity loan granted by the government.
Through the Scheme, you will be granted an equity loan which is 20% of the value of the home you wish to purchase. You will be required to provide a deposit of 5% or more, and your secured mortgage will make up the rest of the sale of your property.
Your Help to Buy loan will be interest free for the first five years (from the date your purchase completed), but you will pay a £1 management fee on a monthly basis.
From the 6th year of you owning your home, you will continue to pay the £1 monthly management fee, in addition to a monthly interest fee, which will be 1.75% of the equity loan value*.
You will only be required to purchase your loan in full during one of the following scenarios:
You pay off your mortgage
You sell your home
You come to the end of your equity loan term
Who is Eligible?
The Help to Buy Scheme is only available to use for the purchase of new build homes.
The existing Scheme is eligible for first time buyers and existing homeowners and is eligible on properties up the value of £600,000 within the West Midlands.
*Please note your interest fee will rise each April by the Retail Price Index (RPI), plus 1%, until you repay your loan in full.
Please note that as of 1st April 2021, the criteria for Help to Buy will change, and will only be available to first time buyers only. Buyers will still be required to have a minimum deposit of 5% and the maximum property price in which the scheme can be used will range from £186, 000 to £600,000.
YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON A MORTGAGE OR ANY OTHER DEBT SECURED ON IT.
To find out more about Help to Buy, and if you are eligible to help you purchase with Cornovii Homes, contact our friendly team.