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THE LITTLE BOOK OF

HELP TO BUY


WE KNOW WHY PEOPLE LOVE LIVING IN LONDON London’s an amazing place because it isn’t really one place at all.

It’s a collection of neighbourhoods, each with their own character and charm. At the centre of those neighbourhoods are the villages that Londoners are fiercely loyal to. We’re successful because we understand London’s villages – and not just the schools, shops and transport links that every Agent knows about. We appreciate an area’s heritage, we understand the changes London’s neighbourhoods have gone through and, most crucially, we have a real grasp of why people love living in London’s different villages. When you instruct us to sell your home we’ll use all our insight to find you the perfect buyer.

B L AC K H E AT H

BOW

CANARY WHARF

CLERKENWELL

FULHAM

GREENWICH

SHAD THAMES

STOKE NE WINGTON

I SLINGTON

S U R R E Y Q U AY S

WAPPING

CHISWICK

HACKNEY

S T R AT F O R D


WHAT IS HELP TO BUY? Help to Buy is a government funded initiative set up to help first time buyers and those looking to move up the property ladder, to purchase a property with a minimum personal deposit of 5% of the purchase price. WHY HAS HELP TO BUY BEEN SET UP? The Government is continuing its pledge to help more people across the country become homeowners. It is also concerned with increasing the supply of housing and lowdeposit mortgages. There are two Help to Buy schemes – the “equity loan” and “mortgage guarantee”.


EQUITY LOAN WHEN DOES THE SCHEME START?

The Help to Buy equity loan scheme became available on 1 April 2013.

WHAT PROPERTIES ARE AVAILABLE ON THE SCHEME? This is available on new build properties only, up to the value of £600,000.

CAN I BUY ANY NEW BUILD PROPERTY WITH THE SCHEME? Some new build developments may not have Help to Buy available.

HOW DOES THE “EQUITY LOAN” SCHEME WORK?

This combines the following: • YOU provide a personal deposit of a minimum of 5% of the property value • THE GOVERNMENT provides an equity loan of up to 20% of the property value • A BANK OR BUILDING SOCIETY provides a mortgage for up to 75% of the property value

EXAMPLE HOME AT £200,000 PURCHASE PRICE £10,000

5% Buyer deposit

£40,000

20% Government loan

£150,000 75% mortgage


WHAT INTEREST RATE DO I PAY ON THE GOVERNMENT EQUITY LOAN?

This is interest free for the first five years. After this period, a fee of 1.75% is payable on the equity loan. This will increase by the rate of inflation plus 1%.

WHAT RATE OF INFLATION WILL BE USED?

Without getting too complicated, the Retail Prices Index (RPI) will be used, which is one of the recognised measures used by the Government to measure inflation.

WHEN WILL I HAVE TO PAY BACK THE EQUITY LOAN? The loan can be repaid at any time within the term of the mortgage, or alternatively on the sale of the property, which ever is soonest.

WHO IS THE SCHEME AVAILABLE TO?

Help to Buy is available for both first-time buyers and existing homeowners

CAN I USE HELP TO BUY FOR A BUY-TO-LET PROPERTY?

The scheme is only available on properties that will be occupied by the person or persons who have taken out the mortgage, who do not own any buy-to-let properties.

AM I ABLE TO GET AN INTEREST ONLY MORTGAGE USING HELP TO BUY?

The scheme is only available in relation to repayment mortgages.

Search on our web site for properties that match your financial criteria.

LOOK FOR THE LOGO ON THE PROPERTY PAGES. fjlord.co.uk/help-to-buy


MORTGAGE GUARANTEE WHEN DOES THE SCHEME START?

The scheme has started and lenders all have individual dates for when they are on board. However, the Government has announced that people will be able to start applying for the new mortgage guarantee from 7th October 2013..

WHAT PROPERTIES ARE AVAILABLE ON THE SCHEME?

This is available on new build and existing homes, up to the value of £600,000.

HOW DOES THE “MORTGAGE GUARANTEE” SCHEME WORK? • YOU provide a personal deposit of a minimum of 5% of the property value

• THE GOVERNMENT and the BANK OR BUILDING •

SOCIETY then jointly guarantees up to the next 15 per cent of the property’s value, in return for a fee paid for by the lender. A BANK OR BUILDING SOCIETY provides a mortgage for up to 95% of the property value

WHY WAS THE SCHEME DATE BROUGHT FORWARD ?

To be able to offer the guarantees ahead of schedule, the Government wanted to allow lenders to start writing loans that will become part of the scheme once it opens in January 2014 Because lenders know that they can purchase a guarantee on these loans when the scheme opens in January 2014, it means that they are able to offer high loan to value mortgages sooner.

EXAMPLE HOME AT £200,000 PURCHASE PRICE 5% Buyer deposit Government guarantee

95% mortgage


WHO IS THE SCHEME AVAILABLE TO? • Help to Buy is available for both first-time buyers and • •

existing homeowners There will be tough checks to make sure buyers can afford their mortgage payments and the borrowers’ income will be verified. The new mortgages will not be available to people with a history of difficulties making debt repayments.

CAN I USE HELP TO BUY FOR A BUY-TO-LET PROPERTY?

The scheme is only available on properties that will be occupied by the person or persons who have taken out the mortgage, who do not own any buy-to-let properties.

You can discuss all of your property search needs and requirements with our teams in branch or on the phone

8AM - 10PM EVERYDAY

Our staff will be able answer all of your questions regarding

HELP TO BUY.

AM I ABLE TO GET AN INTEREST ONLY MORTGAGE USING HELP TO BUY?

The scheme is only available in relation to repayment mortgages.

Getting the right advice at an early stage is really important. Talk to the Help to Buy experts from Just Mortgages, who can help you through the entire process and provide independent mortgage advice too. Your home may be repossessed if you do not keep up repayments on your mortgage. Just Mortgages typical fee for arranging a mortgage is £495. The actual amount payable will depend on your circumstances.


C O N TA C T U S

For a free market valuation, or just to talk about the market in your corner of London, get in touch with your nearest office. There will be someone at the end of the phone from 8am-10pm every day. BLACKHEATH STANDARD SALES 020 8293 1143

HACKNEY SALES 020 8986 2698

BLACKHEATH VILLAGE SALES 020 8852 9522

ISLINGTON SALES 020 7288 1681

BOW SALES 020 8981 3666

SHAD THAMES SALES 020 7089 6490

CANARY WHARF SALES 020 7987 6776

STOKE NEWINGTON SALES 020 7923 0158

CHISWICK SALES 020 8747 8601

STRATFORD SALES 020 8536 0785

CLERKENWELL SALES 020 7251 9449

SURREY QUAYS SALES 020 7237 2320

FULHAM SALES 020 7610 6551

WAPPING SALES 020 7481 8811

GREENWICH SALES 020 8293 8555 FJLORD.CO.UK


fjlord.co.uk


Felicity's little book of Help to Buy