Tuesday, 17 October 2017

‘Help to Buy’ isn’t just for first-time buyers

YOU may already be aware of the Help to Buy scheme that was introduced back in

YOU may already be aware of the Help to Buy scheme that was introduced back in 2013, but there are different versions of Help to Buy that are available, not just for those who are first-time buyers...



Equity loans

The Help to Buy equity loan is excellent for those looking to move home into a new-build property that is no more than £600,000, but who are struggling to find the funds for a deposit.

Perhaps your current home has not gone up in value enough to fund the deposit for your next move? Or perhaps the price jump between your current home and the new house you want to move into is too high?



This is the case for many flat owners looking to move into a house, as figures released from Zoopla showed that the price difference between a flat and a house is increasing. Over the past decade flat prices have gone up by 15 per cent and house prices are up 21 per cent.

For the equity loan, as long as you have a five per cent deposit, you can borrow 20 per cent of the purchase price interest-free for the first five years. After five years, the interest rate will be 1.75 per cent by RPI, increasing by another one per cent each year. For those in the London area, you can borrow up to 40 per cent of the purchase price.

So if you already own a small property and are looking to move up the ladder and into a new-build, then the equity loan could give you the boost you need to help get you to where you want to be without having to wait and build up your savings first.

Finding the deposit is still the largest challenge many buyers face, and since the scheme started almost two in 10 applicants are existing homeowners in need of that extra bit of help to move them up the ladder.

Mortgage guarantees

Another option for those with a good credit score who are looking to move into either a new-build or an older property is the government-backed mortgage guarantee.

If you have a deposit of at least five per cent and are either a first-time buyer or looking to move to another property, then with the help of this guarantee, banks and building societies will be encouraged to lend you a mortgage. However, this scheme is only available until December 31.

For more information about the Help to Buy schemes, please visit the government website or speak with one of Romans’ professional mortgage advisers who can talk you through all the relevant terms and conditions.



Why speak to a mortgage adviser?

If you’re saving hard to secure your deposit for either your first home or your next home, then you could be a lot closer to moving than you think.

A spokesman for Romans Mortgage Services said: “To learn more about the ins and outs of the Help to Buy schemes, we can help.

“Not only can our trusted advisers explain exactly how the scheme works but we also have access to over 11,000 different mortgage products from 90-plus lenders, so you aren’t restricted in the options available to you.

“Let us take the work off of your hands, and get in touch today to arrange an appointment with one of our expert mortgage advisers. We offer appointments either face to face or over the phone — whatever suits you best.”

The spokesman added that a fee is charged for mortgage advice.

“The actual amount you pay will depend upon your circumstances. The fee is up to one per cent, but a typical fee is 0.3 per cent of the amount borrowed.”

(Please note that your home may be repossessed if you do not keep up repayments on your mortgage.)



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