How does it work?
Once you have saved a 5% deposit, eligible candidates can borrow up to 20% of the value of the property (or up to 40% for Help to Buy properties in London) through this government scheme. You will therefore need a mortgage to cover the remaining cost of the property.
How much does the loan cost?
The equity loan is interest free for the first five years. After that, you will pay a fee of 1.75%, rising annually by the increase (if any) in the Retail Price Index (RPI) plus 1%.
What if I want to sell?
If you wanted to the sell the property, you could do with without restriction. Upon completion of the sale, the equity loan would be repaid by way of a share of the proceeds. If you were to continue living in the property, however, the equity loan would need to be repaid after the maximum 25 years.
Am I eligible?
Yes, if you can afford a 5% deposit and are looking to buy a new build property worth £600,000 or less (£300,000 in Wales) .
How do I proceed?
If you are in the England, you will need to contact your local Help to Buy Agent for more information about eligible properties. Your mortgage application will be subject to credit referencing, underwriting and a property valuation.
Visit: www.helptobuy.org.uk for more information and to find your local agent.
Teachers Building Society has also signed up to support the new London Help to Buy scheme which provides an equity loan of up to 40% for buyers trying to get onto the property ladder in London, compared to the 20% across England.
Visit: www.helptobuylondon.co.uk for more information.
If you are in Wales you need to contact the Help to Buy - Wales team for more information and eligible properties. Your mortgage application will be subject to credit referencing, underwriting and a property valuation.
Visit:www.helptobuywales.co.uk for more information and to find your local agent.