Help to Buy - Equity Loan is designed to help you buy a newly built home from a participating registered house builder. Unlike previous schemes, there is no upper income cap for buyers.
The Government will give you an equity loan of between 10% - 20% of the value of your property to help you buy. There is no interest to pay on this loan for the first five years.
The equity loan will be a second charge on your property and will represent a percentage of the value of your property. So when you pay back the loan, you will pay it back as a percentage of the current market value of your home. For example:
Your home cost £200,000 when you bought it and you had a 20% equity loan of £40,000.
If your home is worth £300,000 when you sell it, you will pay back 20% of £300,000 ie £60,000
Your loan must be paid back either when you sell your property or at the end of 25 years, whichever is sooner.
You will need a conventional mortgage from a qualified lending institution and a minimum deposit of 5% (subject to lender requirements). Don't forget that you will also need enough money to pay for your legal fees, costs of moving, and stamp duty (where applicable).
Your Help to Buy - Equity Loan home must be your main residence - you cannot use this scheme for Buy to Let.
How do I find a Help to Buy - Equity Loan home?
Help to Buy - Equity Loan properties are available from participating registered developers. Homes up to a value of £600,000 can be included in the scheme. You can find details of registered developers offering Help to Buy - Equity Loans throughout the North West by visiting the Help to Buy Agency: http://www.helptobuynw.org.uk/