The Government-backed Help to Buy scheme is an equity loan that lends you up to 20% of the cost of your newly built home, so you’ll only need a minimum of a 5% cash deposit and a mortgage to make up the rest. But how do you know if you’re eligible?
Are you eligible?
Help to Buy: Equity loans are available to first time buyers as well as existing homeowners looking to move. The home or property you want to buy must be newly built and part of the scheme, and must have a maximum purchase price of no more than £600,000.
Including the 5% deposit, you will also need to be able to take out a mortgage for 75% of the value of the property. The remaining 20% is what the Government will loan you for five years interest free.
If you own any other properties at the time of completion, you won’t be eligible for the equity loan as it must be your only property and it’s worth noting that you won’t be able to sublet this property. The equity loan is also not available to investor purchasers or those buying a second home or holiday home.
It’s important to note that all applications are subject to credit checks and stress tests, and each mortgage lender will have their own terms relating to who is eligible, so make sure you speak to an expert to check.
Is the only option an equity loan?
No. There is also the Help to Buy ISA meaning that the Government will boost your savings by 25% (up to £3,000) if you’re using a Help to Buy: ISA account from a range of building societies and banks. The bonus from the Government must be included with the funds at the completion of the property transaction – it can’t be used as part of the minimum 5% deposit.
Need some more advice?
Here at Mishon Mackay, members of our New Homes team are experts in the Help to Buy process and can help you understand how it works in more detail and put you in touch with our recommended independent financial advisors.
Ready to start looking for a property?
We have a several new developments currently available that offer the Help to Buy scheme. From one-bedroom homes in Brighton and four-bedroom family homes in Rottingdean, to spacious detached houses in rural villages and two-bedroom apartments in Hove, there’s plenty to choose from.
North Road, Preston Park
A beautifully restored coach house with generous accommodation, two parking spaces and immense character
Beacon Close, Rottingdean
Beautiful four-bedroom family homes situated in a private cul-de-sac in the picturesque Rottingdean.
Boundary Road, Hove
Exciting new stylish development of two-bedroom apartments with private parking and balconies.
Sunny Meadows, Ringmer
Award winning Sigma Homes has released ten two, three and four bedroom homes available on this exclusive development, centrally located near the historic town of Lewes.