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HELP TO BUY ENDS: WHAT ELSE IS AVAILABLE?


Are you looking to buy your first home?

Applications are now closed for the Help to Buy loan scheme in England but what other help is out there right now?

We’ve taken a look at some of the other government schemes and legislation changes that aim to either help you to get on the ladder, or to buy your next home.

WHAT’S HAPPENING WITH HELP TO BUY?

The Help to Buy Equity Loan, set up to help first-time buyers purchase a home in England, has now closed to new applications. All homes being purchased via the scheme will need to have completed by the end of March next year.

AND WHAT ABOUT HELP TO BUY ISAS? The deadline to open a new Help to Buy ISA has already passed. However, anyone with an account already open can add up to £200 per month until the end of November 2029. You can still claim the government bonus – currently 25% on savings up to £12,000 – which is payable on completion of a first home purchase until 1 December 2030. If you don’t already have a Help to Buy ISA, then a Lifetime ISA could be used as an alternative. To open one, you need to be over 18, but under 40. You can save up to £4,000 each year until you’re 50, and the government will top-up the saved amount with a 25% bonus (a maximum of £1,000 per year as a bonus). Like the Help to Buy ISA, you’re able to withdraw the funds to purchase your first home. STAMP DUTY RELIEF FOR FIRST-TIME BUYERS In September, the government announced a permanent change to the amount of stamp duty tax that’s paid on homes purchased in England and Northern Ireland. The threshold at which home-buyers start to pay stamp duty was raised from £125,000 to £250,000. If you’re a first-time buyer, there are further savings offered. You won’t pay any stamp duty on a home priced up to £425,000. For a home priced above this, you’ll pay 5% on the amount you spend between £425,001 and £625,000.

DEPOSIT UNLOCK

Deposit Unlock is similar to the Help to Buy Equity Loan scheme, in that it aims to help home-buyers to purchase a new-build home with a smaller deposit of 5%. However, unlike the Help to Buy scheme, Deposit Unlock is available to all home-buyers, not just first-timers.

There are also some other differences between the two schemes. The Help to Buy loan was interest free for the first five years, but with Deposit Unlock, you’ll start paying interest right away.

Read more about the Deposit Unlock scheme

SHARED OWNERSHIP Shared ownership allows buyers to purchase a share in a property, and pay rent on the remaining part. You can purchase a percentage of the home that’s in line with the mortgage you feel you can afford at that time. It’s then an option to buy a bigger share of the property later if you choose to. There are multiple shared-ownership schemes you can make use of if you meet certain criteria. You can read more about them here.

WHAT’S HAPPENING WITH MORTGAGES, AND WHAT DOES THAT MEAN FOR FIRST-TIME BUYERS? Lenders have tightened their affordability criteria over recent weeks. This is to make sure people are still able to afford their mortgages, if their payments were to increase. So, unfortunately some first-time buyers might find it more difficult to get a mortgage. But it’s important to find out what the best options might be for you. Mortgage brokers and lenders can help you to work out how much you can borrow and what sort of mortgage to take out. They’ll also talk through your specific circumstances to help determine the best lender for you.

Please note: We are not authorised to give financial advice; the information and opinions provided in these articles are not intended to be financial advice and should not be relied upon when making financial decisions. Please seek advice from a specialist mortgage provider such as Choice Mortgage Centre 01209 613143 who we highly recommend.

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