Help to Buy
With Help to Buy, you can buy a new home on an approved new build development with financial help from the Government.
To qualify for Help to Buy:
- You must take out a mortgage with a qualifying lender such as a bank or building society
- Your mortgage and any deposit you have saved must come to at least 80 per cent of the price of the home
- The price of your home must not be more than £600,000
- You will have to pass an affordability check.
How Help to Buy works
The Government will give you an equity loan for the balance (up to 20 per cent) of price of your home that is not covered by the deposit and mortgage.
You will not pay any interest on your ‘equity loan’ for the first five years. After that you will pay a fee on the loan of 1.75 per cent which will rise each year by the Retail Price Index (RPI) plus 1 per cent.
You will own your home outright and you will be able to sell it whenever you like but you will have to pay back the full value ‘equity loan’ to the Government when you sell.