12th March 2020
You’ll need at least a 5% deposit for your new home under the terms of the Help to Buy: Equity Loan scheme. The government will lend you up to 20% of the value of the property (40% in London) and you’ll need to take out a mortgage for the remaining 75% (55% in London).
Each month you’ll make repayments on both your Help to Buy loan and your mortgage. Here’s an illustration of what you would pay on the Help to Buy initiative each month:
- Purchase price: £310,000
- Less deposit: £15,500
- Help to Buy equity loan: £62,000
- Mortgage: £232,500
- Your monthly repayment: £806.87*
*This illustration represents a capital repayment mortgage over a 30-year term on a two-year fixed rate of 1.54% with a £999 arrangement fee and a free basic mortgage valuation. Example rates vary daily so this illustration does not constitute an offer and any mortgage is subject to full underwriting, affordability and credit scoring via the lender. Both this rate and the product were valid at the time of writing.
Remember that a mortgage is a loan secured against your home. Your home may be repossessed if you do not keep up repayments on your mortgage or any other debt secured on it.
If you want to find out more about Help to Buy or would like to know if you’re eligible for a Help to Buy: Equity Loan, contact our expert mortgage advisers and we’ll talk you through your options. Call us on 08454 500200 or click here to get in touch.
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