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Finding a home with Help to Buy

Whether it’s your first or next step on the property ladder, Help to Buy is all about helping people purchase their dream new home.

Finding the right home

A Help to Buy Equity Loan from the government could make a big difference when purchasing as a first-time buyer or if you’re an existing homeowner looking to move. This scheme can boost your equity significantly, meaning you only need to save for a smaller deposit against your preferred property.  

The Help to Buy Equity Loan scheme is exclusively available for newly built homes. This means you’re able to choose from existing new build homes or one that’s soon to be completed. However, if you’re buying off plan, make sure that your mortgage offers you some flexibility, some mortgage offers can be extended if required to suit your property completion date.

With a Help to Buy Equity Loan, you can borrow interest free for five years as well as getting access to cheaper mortgage rates. In addition to that, you also get the benefit of only needing to pay a 5% deposit when purchasing a home. After not paying interest on the equity loan for five years, the rate of interest will only be 1.75% in the sixth year – a generous figure in the current market.

Therefore, not only can you get help moving on or up the property ladder, you’ll also start with the perfect blank canvas to create your home. Visit a development near you and talk to one of our friendly Sales Advisers to find out which homes you could purchase with Help to Buy.

Choosing something you can afford

The Help to Buy Equity Loan scheme is available for new build homes up to the value of £600,000 in England, £300,000 in Wales and £200,000 in Scotland.

Whilst you may only be required to provide a 5% deposit, with a Government loan of up to 20% of the purchase price (40% in London and 15% in Scotland), you’ll still have to secure a mortgage for the remainder of the purchase.

This means that when you’re searching for the right home, you’ll need to consider the cost of the monthly mortgage repayments, stamp duty, valuations and legal fees, as well as how far your deposit will stretch.

The assistance of a new build mortgage adviser will help with this, looking at your affordability and possible mortgage rates.

The first stage of the application process

Finding the right home for you and one that is eligible for Help to Buy is just the first step. You’ll need to inform the property developer that you wish to use the scheme for the purchase and visit helptobuy.gov.uk to find your local Help to Buy agent through a Property Information Form.

You’ll also need to illustrate your financial viability to be considered for Help to Buy. Upon successful completion of your application, you’ll be given access to your equity loan which is interest-free for the first five years. After this period, you will begin to pay interest against your remaining loan.

 






 This guide was produced in collaboration with L&C Mortgages, the UK’s largest fee free mortgage broker and adviser.

 
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