LOUISE BURGESS, FROM LEVI SOLICITORS LLP, TELLS US HER TOP TIPS FOR BUYING A HOUSE
How do I get help to buy my house?
Purchasing a home can be costly, and getting that first step on the property ladder can be especially difficult. However, there are various government schemes which may be able to assist you in purchasing your first home. So what schemes are available to you and how can you use them to your advantage?
Help to Buy
The Help to Buy scheme is a popular scheme and is available on new build houses in England and Wales. It can be used by first time buyers, as well as homeowners looking to move house. It is a government scheme whereby you obtain a loan for a percentage of the purchase price. The loan
is separate from your normal mortgage and you can borrow up to 40% of the purchase price if you are buying in London, or 20% for the rest of England. It is interest free for the first five years of the loan.
The Help to Buy loan scheme allows first time buyers to get onto the property ladder with only a 5% deposit. If you use this scheme, you will pay the interest on the loan after the 5-year interest free period. You must pay the loan back either when you sell the house, or within 25 years of taking out the loan.
Help to Buy ISA
Another scheme which the government have introduced is the Help to Buy ISA. This is a generous incentive scheme encouraging first time buyers to save in an especially set up ISA. The ISA can be opened with any major bank or building society and, when you are ready to purchase your property, the government will pay a 25% bonus on whatever you have saved. This applies on savings up to £12,000.
You do not have to repay the bonus, but it must be used towards a property purchase. If you are purchasing jointly with a partner, both of you can have an ISA and claim a bonus to use on the same property.
Shared ownership is a scheme by which you purchase a percentage of a property. The other percentage is owned by a Housing Association and you pay rent on the share that you do not own.
When buying your shared ownership property, you will usually purchase between 25% and 75% of the property. You can get a mortgage on a shared ownership scheme however special rules for the mortgage may apply. You must also make sure that you can afford the rent level for the remaining share alongside your mortgage payment. You can then choose in the future to purchase a larger share in the property and eventually own 100% of the property. This is known as staircasing. Purchasing a home can be expensive however the schemes above are available to help first time buyers who may not otherwise be in a position to purchase a property.
If you are purchasing a property for the first time and would like to use one of the schemes above, a specialist conveyancing solicitor will be able to assist.
If you require legal advice, call Levi Solicitors on 0113 2449931 or visit www.levisolicitors.co.uk