As property prices in some areas continue to rise, saving for a deposit becomes ever harder for first time buyers.
You may wish to consider a Shared Equity scheme, where you receive a loan for part of the deposit, enabling you to arrange your mortgage and complete your purchase. As the loan forms part of the deposit, it does not affect the level of mortgage for which you may be eligible.
The loan for the deposit will be repayable after 25 years, although you can repay it sooner and you are also able to sell the property within that time. There is no interest paid on the loan for the first 5 years, therefore your initial costs are lowest when it is hardest to cover your mortgage payments. As it is an equity loan, the loan is a proportion of the value of the house rather than a fixed amount and will increase if the property increases in value, and decrease if the property’s value falls.
Shared Equity Schemes
The Government operates two shared equity schemes; FirstBuy and HomeBuy Direct but not everyone is eligible. You must meet certain criteria regarding your income, residency and other restrictions. There are other options available for first time buyers and we can provide you with advice regarding these..
If you enter into a shared equity scheme we will complete the necessary legal processes to support the arrangement as part of the property purchase
Legally, you own 100% of the property.