As a first time buyer you might feel you have your work cut out trying to secure your first property, and while there’s no escaping the fact you’ll likely be facing your biggest financial challenge in your lifetime so far, there are a number of support schemes out there that can help you on the road to completion.
From first time buyer mortgages, to shared ownership schemes and more, in this guide we’ve detailed some of the extra support and first time buyer incentives you can make the most of right now.
Help to Buy: Equity Loan
Help to Buy in its *current form has proven to be a popular option for many in recent years and the scheme itself was set to officially change as of April 2021 to be exclusively for first time buyers in England looking for new build homes.
However, it was recently announced that the deadline to buy a home under the current scheme in England will now be extended until the end of May, rather than ending March 31. This is chiefly due to Covid-related delays that have put the sale of up to 16,000 homes purchased with the scheme at risk.
However, from April it appears you will also still be able to apply for the new ‘Help to Buy: Equity Loan’ which will again take the form of a loan from the Government that you put towards the cost of buying a newly built home. The *current Government guidance for this new scheme stipulates that:
- You can borrow a minimum of 5% and up to a maximum of 20% (40% in London) of the full purchase price of a new-build home.
- You must buy your home from a homebuilder registered for ‘Help to Buy: Equity Loan’.
- The amount you pay for a home depends on where in England you buy it.
*This is correct as of 10/02/2021, but is subject to change and will be updated accordingly if the Government releases any new information
On the official page you can see the **regional price caps for the new scheme and some examples of how the costs of the scheme breaks down across the purchase of your new property. However, it also says how you need at least a 5% deposit and that the loan is limited to a purchase price of no more than £600,000.
**Source: Helptobuy.gov – data is subject to change, correct as of 10/02/21
You can then pay back the loan over time, but another benefit is that this is interest-free for the first five years, the only charge over this time is a £1 monthly management fee. There’s also the option to repay all or part of your equity loan at any time.
For more information on the ‘Help to Buy: Equity Loan’, take a look at these official Government publications.
Another option you may wish to consider is ‘shared ownership’. This is where you buy part of a home and pay rent on the remaining amount you owe to the provider involved in the scheme.
This can be a useful means of making your purchase more affordable and you do have the option to eventually buy up the rest of the property at a later stage.
This particular first time buyer incentive is something we offer with two providers, Sage Housing and Heylo. You can learn more about this in our shared ownership guide here.
First Time Buyer Mortgages
Getting a mortgage can be one of the trickiest parts of the buying process, but different lenders do offer first time buyer mortgages that are specifically aimed at helping this demographic.
There are a number of options they might offer, including products like fixed-rate, SVRs and tracker mortgages. These are essentially the same as standard mortgage products but are instead often tailored to suit the needs of first time buyers.
We also have a useful guide all about first time buyer mortgages you can read here.
You can use our Mortgage Calculator to work out how much you can afford and to see how much the monthly payments would be for your dream property.
If you have a long-term disability in England, there’s the Home Ownership for People with Long-Term Disabilities (HOLD) that can assist you in purchasing a shared ownership property.
There’s a variety of different criteria you need to meet to qualify for this and its availability depends on whether or not it’s available with the shared ownership provider. To find out more about HOLD take a look at this Government guide.
Extra support from Kier Living
On top of our shared ownership options, our sales teams can also give you extra support and help as a first time buyer. Our knowledgeable staff are on hand to answer any questions you might have about the buying process and can of course help with any enquires you might have on our properties.
To get in touch, find our contact details here.