There are a range of Government Incentives available to those who ‘qualify’. It’s easy to get confused between the different schemes, so below he have broken down the main 4 into basic terms.
Help to Buy
This scheme is available ONLY on new build homes, and ONLY for First Time Buyers.
In simple terms, the government will lend up to 20% of the value of the new build home as an equity loan (40% if you are buying in London). You pay a 5% deposit and take a mortgage on the remaining 75%. The loan is interest free for the first 5 years, after which time interest will become payable. The loan has to be repaid in full at 25 years or when the house is sold, whichever is sooner.
For more information click here to be taken to the government website for Help to Buy.
Forces Help to Buy
The Forces Help to Buy scheme works differently. It is for Armed Forces servicemen and servicewomen who are first time buyers, if they have to relocate or their family circumstances change.
Service personnel are able to borrow a deposit at the equivalent of 50% of their annual salary, interest free (up to a maximum of £25k).
There is a lot of information on the government website regarding this scheme. Click here to be taken to their webpage for more information.
This scheme involves buying a percentage share of a property, while the rest is usually owned by a Housing Association.
If you buy a 50% share by paying a deposit and taking out a mortgage, you will then pay rent on the remaining 50%.
Once you are an owner you will be able to purchase additional shares in the property. This is known as ‘Staircasing’.
Stamp Duty will still be payable, but with Shared Ownership there are different options available on when and how you would like to pay.
for more information click here to be taken to the governments Shared Ownership webpage.
Right to Buy
Right to Buy may be an option for you if you have lived in your council house as a tenant for a specific amount of time, usually 3 years.
Depending on your circumstances, you may also be given a discount on the purchase price of the property you wish to purchase.
As with all government schemes, there are many variables involved, and rules change according to different local authorities.
Click here to be taken to the government webpage on Right to Buy for more information and guidance.