HomeBuy Direct
This is a new product from the Homes and Communities Agency, working in partnership with house builders.
It aims to make more new affordable homes available to eligible buyers currently priced out of the housing market.
It is part of the government's low cost home ownership initiative, and is available in England through local HomeBuy agents and participating house builders and housing associations.
September 2010 will see a number of changes take place to the availability of HomeBuy Direct - please apply now to ensure you don't miss out!
Overview: the ‘stepping-stone’ into home ownership
With HomeBuy Direct, the buyer purchases a new home on a HomeBuy Direct development with assistance from the Homes and Communities Agency and the house builder in the form of two equity share loans.
You must take out a first mortgage (with a qualifying institution). The mortgage, together with any cash contribution from you, must be a minimum of 70% of the full purchase price. To obtain a mortgage you will need at least 5% of your share, so if your chosen property was £100,000 and you were purchasing a 70% share, you would require a £3,500 deposit (approx)
The HCA and the house builder will provide equal equity share loans to make up the cost of your home, up to 30% of the full purchase price.
These equity loans are repaid when you sell your home, at which point you must repay the same percentage of the proceeds of the sale to the agency and the house builder as the initial equity loans. (i.e. if you received equity loans for 30% of the purchase price of your home, you must repay 30% of the proceeds of the sale).
The equity loans are interest free for 5 years. After year five, you will pay a fee on the equity loan of 1.75%, rising annually by the retail price index (RAP) plus 1%
If you purchase through HomeBuy Direct you still have 100% title of your home and you can sell it on open market without restriction. The assistance you receive will be dependant on your financial circumstances, not every case is eligible for the full 30% help.
Local HomeBuy Agents (Plumlife) will assess and approve your eligibility for HomeBuy Direct and you can apply on line!
Any further questions please call our enquiries line and ask to speak to a member of the Initiative Team.
Look on the Property Search for your chosen area and see what is available for HomeBuy Direct!
Following a meeting with the Shepshed Building Society and the HCA we are pleased to announce that the Shepshed have agreed to support HomeBuy Direct throughout England (excluding London) without a customer deposit. Please contact one of our Plumlife IFA Panel should you require assistance.
Please note that the society will not lend on flats/apartments.
