The Help to Buy scheme was launched in 2013 as a means of helping people get on to the property ladder, or to move up the property ladder. Since its launch, new figures show it has helped secure 140,000 homes for 350,000 people.
The government scheme works by helping buyers secure a new build property with as little as 5% deposit. The government offers an equity loan of 20% deposit on the purchase of the property, of which no loan payments need to be made for 5 years. That means that buyers can benefit from preferential mortgage rates at 75% LTV (loan to value), meaning manageable months payments. After 5 years, the equity loan payments will need to begin being paid back. During those 5 years, homeowners will have built some equity in the property, both through the mortgage repayments and also the property perhaps going up in value.
The scheme is available for purchasing properties up to £600,000 in value and is open to anyone up to the age of 75. Potential home buyers will need to have a 5% cash deposit in order to be considered for the scheme. There is more information about Help to Buy on the government’s website, and you can find a list of registered house builders for the East and South East here.
At Grange Mortgages, we specialise in helping people get on the property ladder through the Help to Buy scheme. We have relationships with a number of house builders, meaning we are best placed to offer advice on the process and the financial implications of the scheme.
If you have any queries about the Help to Buy scheme or you are interested in getting a foothold on the property ladder, speak to one of our advisors.