Help to Buy Schemes

In April 2013, the first phase of the Help to Buy scheme in England began, enabling buyers of newly built homes to obtain a 20% equity loan from the government on top of their 5% deposit.  There are similar schemes operating in Scotland and Wales.

On 7th October 2013, the Government announced that phase two is now being launched.   The Mortgage Guarantee Scheme allows first-time buyers and existing owners with 5% deposit the opportunity  to buy a new or second hand property worth up to £600,000.

Under the second phase, buyers only need to provide a small deposit, with the government offering a guarantee of 15% of the loan to the lender – for a fee – to encourage the bank or building society to offer the loan.

Our Conveyancing Solicitors will be happy to assist with your Help to Buy purchase and below is a brief summary of the options available to enable you to choose the most suited to your circumstances:

Help to Buy:  Phase Two

  • 15% of the purchase price will be guaranteed by the Government, enabling access to cheaper mortgage deals.
  • Borrowers will need to find at least 5% deposit and must take out a mortgage to cover the remaining 75% of the purchase price, which can be up to £600,000.
  • Participating lenders at present are Natwest, RBS, Halifax and Bank of Scotland. Other lenders are expected to have Help to Buy mortgages on offer by January 2014.

Help to Buy:  Phase One

  • Equity Loan which allows first-time buyers to borrow up to 20% of the value of a new-build home from the Government, interest-free, for the first five years.
  • Borrowers will need to find at least 5% deposit and must take out a mortgage to cover the remaining 75% of the purchase price, which can be up to £600,000.
  • Participating mortgage companies are Barclays, Nat West, Santander, Halifax, Nationwide, Newbury and Teachers Building Societies.
The government has provided full details on their website, see Help to Buy: Home Ownership Schemes

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