In January of 2013 we released an infographic about the Government help to buy scheme.
We’ve now updated our infographic (below) and added some further information about the help to buy scheme.
Help To Buy Explained Infographic
The Help To Buy Scheme Explained – How Does It Work And How To Apply
Help to Buy is a government scheme that can help you move home with a deposit as low as 5%.
We’ve put together everything you need to know about the two available help to buy options; Mortgage Guarantee and Equity Loan.
Help To Buy Example With A Property Worth £200,000
| Amount | Percentage | |
|---|---|---|
| Cash deposit | £10,000 | 5% |
| Equity loan | £40,000 | 20% |
| Your mortgage | £150,000 | 75% |
Equity Loan – Help To Buy Option One
With an equity loan:
- you’ll need to contribute at least 5% of the property price as a deposit
- the government will give you a loan for up to 20% of the price
- you’ll need a mortgage of up to 75% to cover the rest
Frequently Asked Questions – About Equity Loan Help To Buy
Here we’ve put together some frequently asked questions to help explain equity loan help to buy.
Is It Applicable To Any Property?
No, just new build only.
Deposit Required?
Yes, a minimum of 5%.
Do I Have To Be A First Time Buyer?
No, this scheme is available to all, not just first time buyers.
How Does It Work?
The Government will lend you up to 20% of the value of your property through an equity loan, which can be repaid at any time or on the sale of your home, so you will only need to secure up to 75% mortgage from a bank or building society.
When Does It Start?
The scheme started from 1st April 2013. It will run for 3 years from that date and provide £3.5 billion of addition investment.
Mortgage Guarantee – Help To Buy Option Two
Here we’ve put together some frequently asked questions to help explain mortgage guarantee help to buy.
To qualify for a mortgage guarantee, the home you want to buy must:
- have a purchase price of £600,000 or less
- not be a shared ownership or shared equity purchase
- not be a second home
- not be rented out after you buy it
Frequently Asked Questions
About Mortgage Guarantee Help To Buy
Here we’ve put together some frequently asked questions to help explain mortgage guarantee help to buy.
Is It Applicable To Any Property?
Yes, new build and existing homes.
Deposit Required?
Yes, you’ll need a minimum of 5%.
Do I Have To Be A First Time Buyer?
No, it is also open to existing homeowners.
How Does It Work?
You’ll need to secure a mortgage for your purchase. The Government guarantee should help encourage lenders to offer better access to low-deposit mortgages.
When Does It Start?
Available from January 2014, this scheme will run for 3 years.
Is There A Maximum Purchase Price?
Yes, £600,000.
