Help To Buy

For most people, the buying of a new home, or the selling your existing home can be one of the most stressful times of your life. Apparently only divorce comes higher. Our residential property team understands this.

They also understand the importance of communicating with everyone involved in the process, the importance of acting quickly and efficiently so there are no delays and most importantly, in providing a low cost value for money service.

With property prices at an all-time high, buyers are finding it increasingly difficult to raise the 20% deposit needed to secure a home.  The government is aware of this problem however, and has initiated the Help to Buy Scheme (HTB) as a way to help those without a large deposit purchase their first property or move into a new home.

Do I Qualify For Help To Buy?

The New Help To Buy SchemeTo be eligible for the Help to Buy Scheme (HTB), you must:

  • Have a deposit of at least 5%.
  • Be looking to purchase a home worth £600,000 or less.
  • Be intending to live in the chosen property most of the time.

Once these criteria are satisfied, there are two parts of the scheme to choose from.

Help To Buy Scheme 1 – Mortgage Guarantees

The mortgage guarantee effectively provides an insurance policy for mortgage lenders. The scheme allows buyers to put down a deposit of as little as 5% on a home worth less than £600,000. The government will, in turn, guarantee the lender any mortgage borrowing above 80% of the property’s value if any problems with repayment arose.

The mortgage lenders are therefore taking the same risk as if you had a 20% deposit. As a result, whilst mortgages may not be any cheaper, they are far more readily available and provide a dramatic increase in choice for borrowers.

Help To Buy Scheme 2 – Equity Loans

Help to Buy equity loans are only available for those buying a newly constructed home worth under £600,000.

Provided you have a deposit of 5%, the government will lend up to 20% of the property’s value as an equity loan, meaning you only have to raise a mortgage of 75% for the rest. As you would only be borrowing 75%, as opposed to 95%, you will therefore hopefully have access to a better mortgage rate from your lender.

For the first five years, your equity loan will be interest free. From year six onwards, an admin fee of 1.75% of the loan is charged and this will increase each year in line with inflation plus 1%. It is important to remember that you are only repaying the interest at this point, not the actual loan. Full repayment is expected when you either sell your house, or your mortgage period finishes (whichever comes first). Do note that, rather than paying a fixed cash amount, you will be paying back the market value of the loan at the present time. If house prices rise rapidly therefore, be aware that you could end up repaying a lot more than you previously borrowed.

Contact Seatons Solicitors on 01536 276300 for more information on the Help to Buy scheme and arrange a free initial no obligation chat.

Latest Help To Buy Video

Gemma McKimmie - Seatons Solicitors

Expert Help & Advice With The Help To Buy Scheme

I’m Gemma McKimmie, head of the Conveyancing department at Seatons in Corby. We aim to provide our clients with an outstanding legal service.

We will help and support you and most importantly we work hard for you.

Please contact us for a free initial no obligation chat at our Corby office on 01536 276300 or use our online enquiry form to discuss buying or selling a property.

Latest Articles About Property Conveyancing

Good Quality Conveyancing Is Vital To The Avoidance Of Neighbour Disputes

Poor quality property conveyancing is a sadly common source of neighbour disputes and that is why it is so crucial to engage specialist solicitors to do the job.

Value Of Your Home Blighted By Infrastructure Plans? See A Lawyer Today!

Many proposals for major infrastructure projects never get off the drawing board, but their mere existence is often enough to seriously harm private property values.

Is A Printed Name At The Bottom Of An Email A ‘Signature’? Yes, Says Judge

In a case that broke new legal ground and will have widespread implications, a judge has answered that burning question in the affirmative.

Covid-19 – Open For Business And Safeguarding Our Clients & Staff – Announcement

As we were in the first lockdown, we are 100 percent committed and focused on doing the right things for our clients and our community.

Why Use Seatons?

  • Practical sensible help and information
  • Fixed, competitive and affordable prices
  • We care about you and fight for you
  • Regulated by the Solicitors Regulation Authority
  • We can help resolve your issue quickly & easily

Free Legal Guide To Property ConveyancingDownload our FREE guide to

Property Conveyancing today

Covid19 Information

**UPDATE** WE ARE OPEN FOR PRE-BOOKED APPOINTMENTS ONLY FROM MONDAY 19th July 2021. Our front doors will remain closed to the public for the time being. We are unable to deal with clients without an appointment, but our reception staff can assist you in the interim. We hope you can understand that we are doing this to keep our staff as safe as possible from the ongoing Covid issues.