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Government Help To Buy Scheme – Helping movers as well as first time buyers

12th March 2015

Are you a frustrated home-mover? Help to Buy could be the solution to help you get moving.

In recent years, homeowners have been frustrated because they wanted to move – perhaps because the family needed a bigger house, or to move for a new job – but could not afford to. Many such families have had sufficient income to afford higher mortgage repayments, but could not get a mortgage for more than 80%. If the amount available from the sale of their present property wasn’t enough to cover a 20% deposit on another home, then they were stuck.

If you are one of these frustrated home-movers, then the government’s Help to Buy mortgage guarantee scheme could help you get up to a 95% mortgage – and also help to sell your present property.

You can now take advantage of the scheme even if you already own a property – you don’t have to be a first-time buyer. You will still have to sell your present home but it is possible to complete the sale and the purchase of another property at the same time.

You can now apply for a mortgage of up to 95% of the value of the property you intend to purchase. All you need to do is apply to one of the mortgage lenders who operate the scheme – which includes all the major high-street banks.

The lender will then get a guarantee from the government for the amount by which the loan exceeds 80% of the value. This means that lenders will now be able to offer higher loan-to-value mortgages.

The other big advantage of the new Help to Buy scheme is that it is now applies to existing homes as well as new-build ones. That gives you a much greater choice of homes to look at since you will not be restricted to new developments.

As Help to Buy mortgages are now available on any type of property it will also help with the sale of your present property. Agents report that since the announcement of the new scheme there are many more people looking for homes to buy, but there is still a shortage of homes to sell.

A few restrictions apply to the Help to Buy scheme:

  • You must take out a repayment mortgage, not an interest-only one. Nor is the scheme available on offset or guarantor mortgages.
  • You must not own another property anywhere in the world. As mentioned above it’s OK if you sell your existing home when (or before) you buy another property.
  • You can’t let the property you are buying, you must live in it yourself.
  • You can’t use the mortgage guarantee scheme in conjunction with any other Government scheme, such as equity loans or shared ownership. Your deposit for the property cannot come from a government scheme either.


Mike Berry, residential conveyancing department.

George Ide
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