UPDATE: The Help to Buy Equity Loan Scheme is closing to new applicants on the 31st October 2022. This is to ensure that you have legally completed on your purchase by the 31st March 2023 when the scheme comes to an end. For more information click here
The Help to Buy Scheme is a Government initiative offered on new build properties, as a way to help you with your purchase. Since the scheme started in 2013 it has been changed several times and in April 2021 a new scheme was launched. The latest scheme changes how it operates and who is eligible.
By using the Help to Buy scheme, you are able to secure and purchase a property on the site with only a 5% cash deposit. The Government then lends you up to 20% of the purchase price, with the remaining 75% being covered by a standard mortgage.
The loan from the Government is interest-free for the first 5 years, and will need to be re-paid either within 25 years, at the end of your mortgage agreement, or when you sell your home – whichever comes first.
To qualify for the latest Help to Buy scheme, you must be a first-time buyer, as must anyone else you may be buying alongside with, and the purchase price of the property must be under the ‘price cap’ set by the Government in your area. The caps for the local area are as follows:
Yorkshire & The Humber – £228,100
East Midlands – £261,900
West Midlands – £255,600
At Banner Jones, we have a wealth of experience dealing with conveyancing under the Help to Buy scheme. We explain the entire process in a straightforward and uncomplicated manner. For a free, no obligation quote call
At what point in the process is it legally binding?
You can withdraw from a sale or purchase up until the point contracts have been exchanged. Any deposits paid after exchange of contract will then by non-refundable. After contracts are exchanged you are then responsible for the property you are buying and should arrange suitable insurance from this date.
How long are local searches valid for?
A local authority search completed for a house purchase is valid for 3 months.
How long does the conveyancing process take on average?
We usually say 8-12 weeks for an average sale or purchase. Queries and concerns can often come out of the local authority searches which need further investigation and sometimes this leads to re-approval from the Mortgage lender. This can add further time into the process.
What happens if the house I am buying has quarantined owners in it?
Unfortunately, in this situation the seller will not be able to give vacant possession, which will lead to completion delays. As a preventative measure, as per question 1, we can offer to exchange contracts and complete on the same day, which ensures that contracts are only exchanged if all parties in the chain are able to move on that day, thus reducing the risk to all parties. This can be more stressful so we ask that clients be sensible and accommodating of the situation.
What happens if we can’t produce certificates for work we’ve had done on the house we’re selling?
You can indemnify the work by taking out an insurance policy. This means that you can not be held liable for any future fault on the work that was done. We can arrange this for you
What is Stamp Duty and how much will I have to pay?
Stamp Duty is a tax levied by HM Government on a transfer of property. For residential single property ownership this tax is calculated at 5% for the portion of the property value between £250,001 and £925,000, 10% for the portion between £925,001 and £1,500,000 and 12% for the portion £1,500,001 and over. Duty may also be chargeable on any rental charge (leases only) - this affects both residential and commercial leases where different thresholds are applied. There are different rates for First time buyers and "second homes/buy to let".
What is the difference between Joint Tenants and Tenants in Common?
Tenants is Common is where two or more people are entitled to the proceeds of sale in distinct shares - on the death of one, his/her interest will not pass to the survivor(s) but will be part of his/her estate. Joint Tenants are on the other hand 50/50 Co-owners of land - when one of them dies, his/her rights of ownership pass to the survivor(s).