Quick Answer: What Is The Benefit Of Help To Buy?

Should I use the help to buy scheme?

Help-to-buy can be a good option if you are keen to buy a new-build property from one of the house builders registered with the HCA (which they will be if they offer help-to-buy homes) and you need the 20% equity loan (40% in London) from government to be able to complete the purchase..

What is the downside of help to buy?

The Help to Buy equity loan is only available for new build properties, not resale homes. You cannot buy a home that is on the market for more than £600,000. Only suitable if you can afford the mortgage repayments for the value of the entire property.

Is there an income limit for help to buy?

There is no maximum household income level. You will require at least a 5% deposit of the full purchase price of the property. You must take out a mortgage which will need to be for 25% or more of the full purchase price. Help to Buy is only available on new build homes.

What happens to help to buy after 2021?

The Government has announced a new Help to Buy scheme to run from April 2021. It is restricted to first-time buyers and includes regional property price caps to ensure the scheme reaches people who need it most. There are no changes to the current Help to Buy equity loan scheme which runs to March 2021.

Can you buy any house with help to buy?

The Equity Loan part of Help to Buy only applies to properties worth up to £600,000. Unlike previous schemes, there is no maximum income requirement, but the property must be a new-build home. The property purchased must also be your only residence. You cannot use Help to Buy to purchase a buy-to-let property.

Can you remortgage to pay off help to buy?

Staircasing a Help to Buy loan is the process of reducing the government loan in 10% value stages. Depending on your current income and expenditure you may be able to remortgage to an amount that will allow you to start a partial repayment of the Help to Buy loan on your property.

How do I repay help to buy?

How do you repay a Help to Buy Equity Loan?You can make repayments at any time.Repayments must be at least 10% of your home’s current market value.Staircase payments may be subject to other criteria set by your lender.More items…

Can you be refused help to buy?

If your help to buy application is rejected by the help to buy agent it is likely you didn’t meet the eligibility requirement for the help to buy scheme. If it is rejected by the provider, you should ask them why.

Is help to buy only for new builds?

England. The Help to Buy equity loan scheme is a government scheme currently set to run until 2020. It’s available to first-time buyers as well as homeowners looking to move – but only for newly built homes.

Is help to buy for anyone?

The home you want to buy must be newly built with a price tag of up to £600,000. It is only available to people who do not own any other properties. Using the Help to Buy scheme, first time buyers can get a loan worth up to 20% of the property’s value (40% in London).

How long does help to buy take?

average 6 weeksA help to buy application takes a bit longer than a typical mortgage application due to the fact that you have to consult and wait on your local help to buy agency. It should take on average 6 weeks for the whole help to buy application process to completion of your help to buy home.

What scheme will replace help to buy?

What is replacing the Help-to-Buy equity loan? Although there is as yet no replacement lined up for the Help-to-Buy equity loan scheme, the replacement for the Help-to-Buy ISA is already here.

Do you have to pay back help to buy?

The equity loan must be repaid after 25 years, or earlier if you sell your home. You must repay the same percentage of the proceeds of the sale as the initial equity loan (i.e. if you received an equity loan for 20% of the purchase price of your home, you must repay 20% of the proceeds of the future sale).

Who do I speak to about help to buy?

You can call them on 0300 555 0333 or complain directly via their website.

What happens after 5 years with help to buy?

After five years is up, borrowers must pay a fee of 1.75 per cent of the value of their loan, increasing each year by RPI plus 1 per cent, unless they can pay the loan off, usually by remortgaging.

Can you overpay on help to buy?

The alternative to repaying the equity loan would be to overpay on the mortgage – providing there is a facility to utilise overpayments within the terms and conditions (most lenders will allow you to overpay by 10% of the outstanding mortgage balance each year during the initial scheme without charge).

Can I rent my help to buy flat?

A Help to Buy: Equity Loan is designed to help you to move onto, or up, the housing ladder. It will need to be your only residence until you have repaid your equity loan. You may still be able to rent out a room in your home, as long as you continue to also live in the property.