The new Help to Buy: Equity Loan scheme is coming in to play for buyers, and for those in the North West, this will mean some changes.
Applicants could register for the loan, which is interest free for the first five years, from 16 December 2020 and the scheme is available for legal completions taking place between 1 April 2021 until 31 March 2023.
RSC New Homes, financial advisors to Miller Homes North West, who are currently building new homes in Stretford, report that they have seen a surge in enquiries since the new scheme was launched, likely due to it being specifically tailored to helping first time buyers get onto the property ladder.
The Equity Loan scheme is a repayable loan from the government of 20% of the purchase price of your property. The loan is interest free for five years and is taken into consideration by mortgage lenders as a boost to the amount that a buyer has saved for a deposit. For budding home buyers, there’s a lot of information to consider and navigate. Below, local property experts weigh in on the main points of the new Equity Loan scheme, and its benefits for first time buyers.
Clare Noakes, Sales Director for Miller Homes North West advises Manchester homebuyers that: “One of the biggest changes of the scheme is that it is now only available for first time buyers. Before, current property owners were able to take advantage of the perks too.”
“Another big change is that regional price caps have been introduced. For example, for buyers in the north west, you can only use the Equity Loan scheme on properties with a purchase price of £224,400 or below. These price caps vary by region.” She adds.
Andy Mannion, Financial Advisor at RSC New Homes explains: “The main benefits are that lenders see the Equity Loan as an additional deposit from buyers, meaning that mortgage rates at 75% are available to purchasers which are much more competitive than 90% mortgages.”
Clare also explains that: “The new Equity Loan scheme is only available on new build properties and will help those with a 5% deposit buy their first home; this has helped many people in the past get on the property ladder who otherwise may have struggled.”
Andy adds that the new scheme means that buyers can continue to enjoy “the energy efficient benefits of purchasing a new build home” as opposed to an older build.
House hunters can find out more information about the Help To Buy Equity Loan scheme on the Government website or via a local Equity Loan agent.
Miller Homes is currently building new homes in the Greater Manchester area at Novus in Stretford, a stylish collection of homes and apartments. Find out more here: https://www.millerhomes.co.uk/new-homes/north-west/novus-stretford.aspx.