Getting to grips with the new Help To Buy
Since launching in 2013, The Help To Buy scheme has helped more than 200,000 people to purchase a new home. With the existing scheme now coming to a close, and a new version launching in April, Scott Howitt from Chartwell Mortgage Services tells us everything we need to know.
How will the new Help To Buy work?
Firstly, while eligibility will vary, it’s important to know that the new national Help To Buy: Equity Loan scheme will work in almost exactly the same way to the previous version.
Running until 2023, the scheme involves the government lending you upto 20% of the cost of your new home, so that you only require a 5% cash deposit to secure a mortgage. Fronting the deposit for a home is often the big stumbling block for first time buyers, so this government assistance has made purchasing a property much more accessible for thousands of people.
Is everyone eligible?
Not this time around. The most significant change for the new scheme is that it will exclusively serve first time buyers. Unfortunately, if you’ve owned a property previously the government initiative won’t be able to support you in taking your next step on the ladder. But, the updated Help To Buy is expected to attract huge numbers of first time buyers hoping to make their first property investment.
Are the regional price caps different?
Yes. Another crucial distinction is that the 2021 Help To Buy scheme will introduce renewed regional price caps. This means that the value of property you can purchase using the loan, will be limited to a specific cost. For example, in the North West you won’t be able to buy through Help To Buy beyond the value £224,400 but the cap increases to £261,900 for buyers in the East Midlands, the cap is £255,600 for the West Midlands, and for Yorkshire and The Humber it’s £228,100. For this reason, it’s important to find out the new regional price caps in your area.
How do I secure the loan?
The process for taking out the loan will operate in much the same way - as will paying it back. Applicants must fit the criteria and the process for making the application will largely mirror the current scheme. The great news is that your Countryside sales team will do all the hard work for you; helping you to fill out the forms and formally putting in your application for you, ensuring you’re kept in the loop every step of the way.