Help To Buy 

Let’s help you to buy your property! 
You have seen a new build property that offers the help to buy scheme and want to know if you’re eligible for the help to buy scheme. 
Help to buy is for first time buyers and existing home owners who are selling their property. Help to buy is not available to buy to let landlords or existing home owners wanting to purchase an additonal property with th Help to buy scheme. 
You need to put a minimum deposit of 5% of the purchase price down. The scheme is available in England on new build properties up to the value of £600,000. The government will give you an equity loan up to 20% of the purchase price. This will be interest free for the first 5 years and you’ll need a mortgage for the remaining 75% of the purchase price. 
If in London, The equity loan can be up to 40% of the purchase price. This would mean you would need a mortgage for the 55% of the purchase price. As the government are helping you get the property. It is entitled to its money back plus a share of the future sale proceeds equal to the percentage it has contributed to assisting you if you have not cleared or repaid any of the equity loan. 

AN EXAMPLE 

If you purchased a property for £300,000 and you put a 5% deposit down, which would be £15,000 and you took a 75% mortgage which is £225,000 and the help to buy equity loan of 20% which is £60,000. You then sold the property at a later date for £400,000, making a £100,000 profit. The government would take the equity loan repaid which is £60,000 plus the 20% of the profit and so an extra £20,000. 
Other considerations with the Help to Buy scheme is that after the 5 years interest free period, you’ll be charged a fee of 1.75% of the loans value and the fee will increase every year in line with inflation. This is worked out by using the retail price index plus 1%. It seems complicated and that's why we are here to guide you and help you through it. 
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