Want to buy your dream home sooner rather than later?

With the Help to Buy: Equity Loan it’s easier than you think.

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What is shared ownership?

Example of Help to Buy

  • You just need to save for a 5% deposit.
  • The government lends you 20% as a 5 year interest free equity loan.
  • This means you'll only need a 75% mortgage.
  • Making you much more attractive to lenders.

Help to Buy FAQs

Help to Buy is a fantastic, government-led scheme which helps people purchase a brand new home with a much smaller deposit.

With Help to Buy you only need a 5% deposit and the government gives you 20% as an equity loan. This means your mortgage is only 75%, giving you access to a wider range of lenders.

Only first-time buyers can benefit from the Help to Buy scheme and you must be a UK resident and meet the affordability criteria.

The affordability criteria is typically 4.5 times your combined gross income, minus the cost of any credit commitments (i.e. car payments or loan repayments).

For example, if you're purchasing as a couple with a combined gross salary of £45,000 and you have a car finance obligation of £149 per month, this is deducted from your income.

Financial commitments: £149 x 12 months = £1,788

Net combined income: £45,000 - £1,788 = £43,212

Mortgage limit: £43,212 x 4.5 = £194,454

Using this figure, the values are broken down as:

75% Mortgage: £194,454

20% Help to Buy loan: £51,854.40

5% Deposit: £12,963.60

This means that using the above example the couple could afford a house up to £259,272*

Absolutely, the idea behind Help to Buy is to help people onto the property ladder. Like any traditional mortgage, the goal for many buyers is to eventually pay off the mortgage on a property and own 100% of their home.

For the first 5 years of having the Help to Buy: Equity Loan there will be no interest to pay. After the first 5 years, you will only pay the interest of 1.75% of the loan amount at the time of purchase. This percentage will rise in line with RPI (Retail Price Index) every 12 months.

For the duration of the loan there will be a small £1/month management fee.

The Help to Buy: Equity Loan is great because you only pay back what the value of that equity is worth. So if for instance your house value drops, so does the amount you pay back. The loan effectively scales meaning that if your house increases in value, remortgaging or selling become viable options to clear the loan. 

Here are the common ways of paying back the loan:

1. Saving to pay off the loan

2. Remortgaging your home once you have built up enough equity in the property

3. Selling your property and using the proceeds of the sale to pay off the balance

Remember, for the first five years, the loan is interest free. Afterwards you pay just the interest on the balance remaining. The loan lasts for 25 years and can be paid back as early as you like, so long as each payment is at least 50% of the remaining balance.

No, Help to Buy can only be used for a single property.

Can I use HTB on any house?” amend to “Help to buy only applies to brand new properties on building developments throughout England. However, price thresholds apply depending on your region.

Region

Price Cap

South West

£349,000

South East

£437,600

London

£600,000

East of England

£407,400

West Midlands

£255,600

East Midlands

£261,900

Yorkshire and The Humber

£228,100

North West

£224,400

North East

£186,100

Most of our developments offer Help to Buy and our sales teams are more than happy to talk you through it in more detail. Explore our developments and speak to them directly.

Your dream home could be closer than you think.

No, it's not.

The Help to Buy: Equity Loan is a 20% loan provided to you by the government which is to be paid back. It can be used in conjunction with the Help to Buy: ISA which is a savings scheme that essentially gives you an additional 25% on top of your deposit. Find out more about the Help to Buy: ISA by visiting the government's website.

The Equity Loan cannot be used with Help to Buy: Shared Ownership. This is a different scheme whereby you mortgage a portion of your property and pay rent on the rest. This is great for people who cannot afford the full purchase price of their home straight away. You can find out more details by visiting the government's website.

You may also like to refer to the Government's website for more information on Help to Buy. 

No, both schemes are designed to help buyers with the purchase a new home, but they work differently.

Read our FAQs on Help to Buy Scotland to find out more.

Help to Buy available at:

Duchy Field, Bletchingdon

Final 5 bedroom new home for sale in the quiet Oxfordshire village of Bletchingdon.

Golden Mede, Waddesdon

New phase released. A new development of 2 and 3 bedroom contemporary homes for sale near Aylesbury.

Monaveen House, Poundbury

Modern and luxurious 1, 2 & 3 bed apartments in the stylish new town of Poundbury, Dorset.

Saltash Place, Poundbury

A luxury development of apartments and villas in the heart of Poundbury, Dorset.


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