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What is Help to Buy ISA Conveyancing?

The Help to Buy scheme is designed to help people get on the property ladder or buy a new home without a large deposit. This government scheme has four parts: Help to Buy mortgage guarantees, Help to Buy equity loans, London Help to Buy and Help to buy Isas.

In this guide, PDR Property Lawyers UK give an overview of how each part of the Help to Buy scheme works. If you are looking at buying a new build, then our new build conveyancing guide can help you.

Help to Buy Terms & Conditions

Below you can find out about Help to Buy terms and Conditions, including how do you qualify, mortgage guarantees and equity loans.

Help to Buy scheme: Do I qualify?

To be eligible for Help to Buy, you must:

  • Have a deposit of at least 5%;
  • Be looking to buy a home worth £600,000 or less (different limits apply for Help to Buy Isas);
  • Be purchasing a property you intend to live in most of the time (ie not a property you intend to let out or use as a second home).

Help to Buy Mortgage Guarantee

Help to Buy mortgage guarantees can help home buyers unlock better mortgage rates. Most of the UK’s biggest mortgage lenders have signed up to offer the guarantees, as well as smaller lenders.

How does the Help to Buy mortgage guarantee work?

  • You put down a deposit of between 5% and 20%, and borrow the remainder from a mortgage lender
  • The government will guarantee any mortgage borrowing above 80% of the property’s value – for example, if you took out a 95% mortgage the government would guarantee to repay your lender up to 15% of its value if you defaulted
  • The property can be old or new-build
  • You don’t have to be a first-time buyer to qualify

Help to Buy Equity Loan

Help to Buy equity loans are among the most popular routes into home ownership, and are only available to people who want to buy a new-build property.

How Do Help to Buy equity loans work like this:

  • You put down a deposit of at least 5%
  • The government lends you up to 20% of the property’s value as an equity loan
  • You take out a mortgage on the rest of the property’s value (so, if your deposit was 5% and your equity loan was 20%, you’d then take out a 75% mortgage).

London Help to Buy

This works in the same way as Help to Buy equity loans, but buyers in London can borrow 40% of the property price from the government rather than 20%. London Help to Buy will be available from early 2016.

Help to Buy can be a little confusing. But with over 10 years experience we can help ensure your Help to Buy runs smoothly and efficiently.

Call today us today  01733 203873 for a free no obligation quotation.

Help To Buy Options:

Help to Buy ISAs are a type of tax-free savings account aimed at people saving to buy their first home. You can no longer open a Help to Buy ISA as the scheme ended on 30 November 2019. However, if you already have an account, you can pay into the ISA until November 2029, and can claim the 25% bonus up until November 2030. For the latest information visit the GOV.UK website.

For every £200 contributed, the government will add an extra £50 towards a deposit on your first home, up to a maximum of £3,000. This is paid to your solicitor when you’re ready to move. You can use Help to Buy Isa savings to purchase a home worth up to £250,000, or £450,000 if you’re buying in London.

If you’re serving in the armed forces, Forces Help to Buy is a special part of the Help to Buy scheme which could help you to buy a property.

Through the scheme, servicemen and servicewomen can borrow up to 50% of their salary interest-free to use for a deposit and other buying costs such as legal fees.

The maximum loan you can get is £25,000, which you’d repay over 10 years.

To be eligible you must:
• have completed a minimum length of service
• have more than six months left to serve when you apply
• meet certain medical categories

To apply you will need to go through the Joint Personnel Administration system. Talk to your chain of command or personnel agency for more information.

By trusting your Help To Buy Scheme to PDR Property Lawyers, you’ll get:
• Fees from £399 plus VAT and disbursements
• The whole process explained from the start
• Friendly and knowledgeable staff
• Regular updates by phone and/or in writing as your case progresses.

Frequently Asked Questions

If you opened a Help to Buy ISA while they were available, in order to claim the bonus you’re entitled to, you will need to instruct your conveyancer when you are close to buying your first home. They will be able to secure this on your behalf.

A mortgage deposit is the amount of money you’re prepared to pay upfront towards the sale of a property. Unlike how most deposits work, this isn’t money that you will lose. It is simply a commitment to pay an agreed percentage of the purchase upfront in order to secure a mortgage. Most mortgages come with a deposit, usually starting from 5%.

Meanwhile, your exchange deposit is an amount of money that your property lawyer transfers to your seller’s conveyancer when you exchange contracts on the sale. If you back out of the purchase after the deposit money has been exchanged, you will lose that money.

Yes. If you’re expecting a government bonus to help contribute towards the purchase of a property, you’re in a good position to negotiate a reduction in the exchange deposit. Your conveyancer should be able to negotiate this on your behalf.