Help to Buy Mortgage
Help to Buy is a Government scheme to help first-time home buyers get a mortgage with a small deposit. There are two types of Help to Buy mortgage schemes:
Help to Buy Shared Ownership (or Shared Equity)Help to Buy Equity Loan
How does a Help to Buy Shared Ownership Scheme work?
If you are a first-time buyer struggling to afford a mortgage on 100% of a home, the Help to Buy Shared Ownership (sometime called shared equity) scheme provides the opportunity to buy a 25% - 75% share of a home, and pay rent on the remaining share. A smaller shared ownership or shared equity mortgage will require a smaller deposit which may make your dream of home ownership a reality. You can increase your ownership share later when your circumstances allow.
The Help to Buy Shared Ownership scheme is available for new build homes or an existing property for sale through a housing association. Shared ownership properties are always leasehold.
To qualify for the Help to Buy Shared Ownership scheme in Carlisle and Cumbria you must be a first-time buyer, you’ve previously owned a home but can’t afford to buy one now or are an existing shared owner looking to move house. Your household must earn less than £80,000 a year (or £90,000 or less in London).
Older People’s Shared Ownership Scheme
If you are 55 years old or over, this scheme works like the Help to Buy Shared Ownership Scheme but you can only buy up to 75% of your home. When you do own 75% of your home, however, you do not have to pay rent on the remaining 25% share.
Your home may be repossessed if you do not keep up repayments on your mortgage.
How does a Help to Buy Equity Loan work?
A Help to Buy Equity Loan comes from the Government and applies to anyone buying a new build house. The Government will lend you up to 20% (40% if you’re in London) of the cost of your home. You will be required to pay a deposit of at least 5% and hold a mortgage of 25% or more for the remaining costs.
You will be required to repay the loan later, but you won’t be charged interest on it for the first five years.
Lifetime ISA
If you're aged 18 – 40, you can save into a Lifetime ISA to help you buy your first home and save for your future.
You can save £4,000 a year into your Lifetime ISA until you're 50 and the government adds a 25% bonus to the money you save, up to a maximum of £1,000 annually.
Frequently Asked Questions
A help-to-buy mortgage is part of a scheme announced by the UK government to assist first-time buyers. Those looking to buy their first property can borrow up to 20% of the purchase price (40% in London) from the scheme, which is interest-free for five years. The minimum deposit is 5%, mortgage finance from 75% (from 55% in London) with the balance provided by the help-to-buy scheme.
Need to know more? Get in touch with our team:
Why work with us?
At Stan Sherlock Associates, arranging a mortgage is not a one-off transaction. We aim to build long term relationships with our clients and provide you with an advice service over the lifetime of your current mortgage, and beyond, which ensures you always have the right deal for your situation.
Although based in Carlisle, our clients come from much further afield. We regularly work with clients from across Cumbria (including Kendal, Keswick, Penrith, Whitehaven and everywhere in between), the Scottish Borders and North East England. Many of our mortgage advice services can be provided by phone and email but our mortgage advisers are always happy to meet you face to face.
