Help To Buy Equity Loan
In his budget speech the Chancellor announced two new proposals for homebuyers under the inventive title of “Help to Buy”.
From 1st April 2013, the “Help to Buy : Equity Loan” was opened to all those who aspire to own a new build home. It will replace and build on the principles of the “First Buy scheme.
The Government will:
The “Help to Buy: Equity Loan” will be open for the next three years, which the government anticipate will provide £3.5 billion of investment in England, supporting up to 74,000 more home buyers as well as providing a boost to the construction sector. The scheme will apply in England only. A share of the money will be allocated to the devolved administrations for them to use on their own schemes.
Help To Buy Mortgage Guarantee
The second scheme, a Government guarantee, will encourage lenders to offer better access to low deposit mortgages. This will be paid for by fees charged to lenders in such a way that they compensate the Government for expected losses, the cost of capital and administrative costs. The “Help to Buy : Mortgages Guarantee” will, subject to the final design, make available up to £12 billion of government guarantees, sufficient to support up to £130 billion of high loan-to- value mortgages.
The devil is in the details on this scheme, although details are still being finalised we do know the following;
These new schemes will sit alongside the existing Newbuy schemes.