Very often purchasing your first home can seem a little like a financial mountain you need to climb. What with the house price increases over the past year, things such as finding not just a deposit but funds to make up the difference between house price and your borrowing limit can add further challenges.

There however, are some excellent schemes available for first-time buyers and as well as paying 0% stamp duty on the first £300k, the Help to Buy scheme is available to provide support when purchasing a new build property.

The Help to Buy scheme offers a government equity loan to first-time buyers in England when purchasing a newly built home. The condition of this is that the home must be used as their main residence and the scheme cannot be used to purchase a second home or buy-to-let property.

The help to buy equity loan is up to 20% (40% in London) of the purchase price and is interest free for five years. In addition to this, a deposit of at least 5% is needed.

When considering Help to Buy, there are some ceiling prices (below), and a property cannot be purchased above these.

The current scheme expires in March 2023 and there is a simple six step process first-time buyers need to follow when accessing the scheme:

1. Reserve a new build property with a registered homebuilder
2. Apply online through the Help to Buy agent in your region
3. Your application is assessed and Authority to Proceed issues
4. The Authority to Proceed allows you to apply for your repayment mortgage and the Help to Buy agent will issue an authority to exchange.
5. Once all paperwork and dates are agreed and the home is built, The Help to Buy agent will issue a transaction confirmation where funds are transferred to the homebuilder.
6. Following completion, the Help to Buy agent will pass your details to the equity loan administrator to manage the loan account until it is fully paid.

Do you have questions about the Help to Buy scheme? If so, you can either call us on 01322 553282 or contact us online.