Help to buy homes for sale in London are becoming more and more prevalent on the market. What started off as a scheme that homebuyers were unsure about or didn’t quite understand, Help to Buy is fast becoming one of the most popular ways for first time buyers to own their first property. Many developers are now registered with the scheme and offer advice on their help to buy homes for sale in London. Plus a number of other perks too!
With an equity loan, those looking for help to buy homes for sale in London only require a 5% deposit. So for a brand new £200,000 apartment, a deposit of just £10,000 is required to get the ball rolling. You will then receive an equity loan from the government of £40,000 (20% of the value of the property) and the rest is made up with your £150,000 mortgage. The scheme appeals to lenders because they don’t have to offer such large mortgages and they have the support of the government to back them up. So it is easier for first time buyers to get a mortgage.
The fees for equity loans are as follows (and remember that you won’t be charged any fees for the first 5 years of owning your home):
In the 6th year you will be charged a fee of 1.75% of the loan’s value. This gives you plenty of time to save for this fee. It is also important to be aware that fees don’t count towards the paying back the 20% equity loan. After this, the fee will go up each year and this is worked out by using the Retail Prices Index plus 1%. A Help to Buy agent will contact you before you have to start paying the fees and it is simple to stay up to speed with your account via your Help to Buy statements.
If this scheme is the route you want to take, when researching Help to Buy Homes for Sale in London, you must look at homes from registered Help to Buy builders. You can easily find lists of registered builders online or from your Help to Buy Agent.
When looking at Help to Buy Homes for sale in London you should be aware that you have to pay back the loan after 25 years or when you decide to sell your property. How much you have to pay will be influenced by the market values at that time.
An equity loan is a great incentive for those who need help to buy homes for sale in London. Inspired Homes are registered Help to Buy developers. You can find out more about our homes here.