Interest rates are at their lowest in a decade and house prices have been on the rise. Now could be the perfect time to buy your first property. However, that doesn't mean that getting a mortgage is easy. Banks are stricter than ever before and every decision counts. The government has created a new scheme called Help to Buy whereby they offer you a 20% equity loan for the purchase of your home. You just need to provide a 5% deposit and make sure that you earn less than £80,000 per year with any other assistance from family or friends. Here’s everything you need to know about this program and how it can help you buy a home without putting too much strain on your monthly budget.
Buying your first home can seem daunting, and with the current housing market it has never been more difficult. However, there is some good news for those who are considering purchasing their first property. The government has created a new scheme called Help to Buy. Under this scheme, you will be offered a 20% equity loan for the purchase of your home. All you need to provide is a 5% deposit and make sure that you earn less than £80,000 per year. If these requirements are met, then this scheme could help you take the first step towards owning your own house without putting too much strain on your monthly budget. Here’s everything you need to know about this program and how it can help you buy a home without putting too much strain on your monthly budget.
1) Who is eligible?
2) How do I apply?
3) What does the Help to Buy Scheme offer?
4) What are the benefits of buying my first home through this program?
5) What are the restrictions when applying for Help to Buy?
6) How long is my mortgage term going to be if I buy through Help to Buy?
The Help to Buy Scheme is a government scheme that offers first-time buyers the opportunity to get onto the housing ladder with a minimum of 5% deposit. The government will then provide an equity loan for up to 20% of the house’s value, which can be repaid over a 30-year term.
You can apply for the Help to Buy Scheme if you meet the following criteria:
- You have a monthly household income of less than £80,000pa or have savings of at least £15,000
- You are a first-time buyer who cannot afford to purchase a home without help from their family
- You are buying your property with a mortgage
- Your home is worth less than the maximum available equity loan amount (£250,000)
In order to apply for the Help to Buy Scheme, you need to be a first-time buyer who's not owned a property in the last 3 years. You must also live in England, Wales or Northern Ireland and provide your salary details. If you are eligible for the scheme, the government will then check if you can afford the mortgage without the 20% equity loan.
There are a few terms and conditions for this program. First, you can’t buy a home that costs more than £250,000. Second, the home has to be newly-built or newly converted so you won’t be able to purchase one that’s been lived in by somebody else. Third, the property must be your primary residence. Fourth, your loan must not exceed 4.5 times your income (any income from benefits will not count). And fifth, if you are buying a new build property then the contract needs to be agreed on within 90 days of it being made available on the market with completion set at least six months after that agreement date.
We hope these tips on how to get help with your mortgage through the Help to Buy Scheme have been useful. The scheme is open to homeowners who have been renting for more than three years, those who are in the process of building their own place, and those who have a household income of less than £60,000. So if you're on a low income, but are looking to buy your first home, this scheme might be a good option for you.
