What is Help to Buy?

 03 June 2020

Help to Buy is the equity loan help for home buyers from Homes England which makes new build homes available not only to first time buyers but to all new build home buyers who might otherwise be unable to raise the necessary deposit but could afford a mortgage.

Up to a maximum of 20% in England and up to 40% in London, of the purchase price can be lent to buyers through this Government equity loan scheme. The scheme is still in place and currently set to run until 2021.

The Help to Buy loan will be paid directly to the developer on completion and Homes England will take a secured charge – a second mortgage – against your new home.

A few helpful facts to consider:

  • You must provide a 5% cash deposit.
  • You must take out a first charge mortgage with a qualifying lender.
  • The maximum purchase price is £600,000.
  • The property purchased must be your only residence.
  • Help to Buy is not available to assist buy-to-let investors.
  • You cannot rent out your existing home and buy a second home through Help to Buy.

The above article is for guidance only and does not constitute legal advice.  Relevant law applicable as at date of publication only.

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