So you are looking for a new home and you have heard about Help to Buy - but what actually is it - and is it right for you?
Well, Help to Buy is a Government backed scheme, designed to assist those with smaller deposits onto the property ladder. The Help to Buy equity loan scheme is available across new build homes (only) and as of April 2021, it is available solely to first time buyers.
If you are looking to buy a new build home (in England) and you are a first time buyer then you should be able to apply for a Help to Buy Equity Loan (as long as your homebuilder is registered for Help to Buy – which we are at BoKlok on the Brook!). This is a loan, which is provided by the Government that you can then put towards the cost of buying your new home.
Essentially under the scheme, you can own 100% of your home with as little as a 5% deposit and a 75% mortgage. The Government provides the remaining 20%, as an interest-free loan for the first five years. (After this time, you will start to pay interest on the equity loan amount borrowed.)
Below, we have tried to answer a few of the most frequently asked questions:
Who can access Help to Buy?
As of April 2021, the Help to Buy Equity Loan is available to first time buyers only (and you must be purchasing a new build property).
How much deposit do I need to put down?
You will need to put down a minimum of a 5% deposit.
So how much can I borrow as a Government loan?
You can borrow between 5% and 20% of the full purchase price of your new build home (or up to 40% if you are buying in London).
When do I need to pay back the Government loan?
You do not pay any interest on the equity loan for the first five years. After this, you start to pay interest on the equity loan amount you borrowed.
Can I repay the loan in stages?
You can repay all or part of your equity loan at any time. A part payment must be at least 10% of what your home is worth at the time of repayment.
When will I be required to repay the loan in full?
You will be required to repay the loan in full either at the end of your mortgage term (which is typically 25 years), or when you sell your home – whichever comes first.
Where can I get more information?
You can access more information on the Government Help to Buy website.
If you have any questions about Help to Buy and whether you would be able to use this scheme to assist with a purchase at BoKlok on the Brook in Bristol, get in touch with us today. Our friendly team would be happy to talk everything through with you. You can call us on 0117 261 6160.
Below you can see a couple of examples, based on the starting prices for our apartments and our houses at BoKlok on the Brook.