You borrow up to 20% of the value of the property (40% in London) you intend to buy – this is the equity loan. It’s up to you what percentage you take, as long as you put down at least 5% yourself as a deposit.
Regarding this, can a second time buyer get Help to Buy?
The biggest misconception is that Help to Buy schemes are only available to first-time buyers. In fact, they’re also available to previous homeowners, as long as they don’t own another property at the time of their Help to Buy purchase.
Moreover, can you borrow more with Help to Buy?
We may allow you to borrow more on your repayment mortgage to pay off leasehold arrears or mortgage arrears – we consider each request individually. You can either remortgage with your existing lender or change to a new one.
Can you get rejected from 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.
Can I transfer my mortgage to another lender? Yes, but you need permission to change your mortgage provider. Get in touch with the Help to Buy: Equity Loan administrator (opens in a new window) to let them know your plans.
You can use the Help to Buy: ISA with other government schemes, including the Help to Buy: Equity Loan scheme and Shared Ownership.
You will need the help of a Solicitor or Conveyancer to assist you in buying the property and to advise you on the details of the Help to Buy Equity Loan.
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. So, 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.
2021 changes to Help to Buy scheme
The Help to Buy scheme is changing in Spring 2021 because from April, only first-time buyers will be able to use the scheme and the current plan is to end it completely by 2023. The scheme will set a regional property price cap to focus on helping those who need the scheme the most.
To qualify for a help to buy equity loan you need to be buying a new-build property that you’ll be living in as your main home. You don’t need to be a first-time buyer, but you’ll need to sell your current home in the process of buying the new-build home. You won’t be able to rent out any part of the property you buy.
The new Help to Buy scheme is available to first-time buyers only, subject to eligibility, and is restricted by regional price caps. In London, the initiative is available on new build properties with a maximum value of £600,000.
Help to Buy loans are interest-free for the first five years. … This means that the interest rate quickly ramps up, which can make the loan more expensive than a traditional mortgage. It’s therefore wise to pay off the Help to Buy loan within the interest-free period to avoid these higher rates.
The disadvantages of Help to Buy – is it right for me?
- The amount you owe isn’t fixed. …
- Your loan will become more expensive. …
- Only certain lenders offer Help to Buy mortgages. …
- It can be hard to remortgage. …
- Help to Buy is only available on New Build Homes. …
- You need permission to make improvements.
You must be at least 18 years old. You must be a first time buyer, meaning that you have never owned another property either in the UK or abroad. If you are purchasing a property with another person, you must both meet the definition of a first time buyer to benefit from the scheme.