Helping First Time Buyers Get Onto The Property Ladder
We know that getting onto the property ladder and buying your first home can be a challenge for many. Just last month, a new government-backed mortgage scheme was launched aimed at helping first-time buyers or current homeowners secure a mortgage with just a 5% deposit. With this in mind, we thought we would make a list of some of the schemes available to help first-time buyers make that first step onto the property ladder.
95% Mortgage Guarantee
As we mentioned in the introduction, on the 19th April 2021 the Government launched a mortgage scheme to help people with 5% deposits get on to the housing ladder. Whilst current homeowners can also access this scheme, first-time buyers will also benefit from the opportunity to apply for a mortgage with a 5% deposit. The scheme will help to increase the supply of 5% deposit mortgages for credit-worthy households by supporting lenders to offer these products through a government-backed guarantee.
So far, high street lenders such as Lloyds, Santander, Barclays, HSBC and NatWest have launched mortgages under the scheme this week, with Virgin Money planning on launching their offer next month. Opening this month, the scheme is set to run until December 2022.
Help to Buy (Scotland): Smaller Developer Scheme
The Help to Buy (Scotland) scheme was established by the Scottish Government to provide assistance and help those purchasing a new-build home without the need for a large deposit.
To be eligible to take advantage of this scheme, you may only buy a new build home from a builder who is registered with the scheme. The Scottish Government has a list of participating home builders, which can be accessed here. The scheme is administered by Link on behalf of the Scottish Government throughout the whole of Scotland.
The scheme is set to run until the 31st March 2022, and if you would like to purchase a new build through the Smaller Developer Scheme, the property purchase price cannot be more than £200,000.
Shared Ownership
Another option for first-time buyers looking for a helping hand onto the property ladder is through Shared Ownership. In a previous blog, we talked in-depth about the Shared Ownership scheme but it allows you to buy a percentage share of a property, with a housing association owning the remaining share.
The scheme is mainly aimed at first-time buyers (but not exclusively) and depending on your circumstances and what you can afford, you can buy either a 25%, 50% or 75% share of a property. Once you have been living in the property for a year, you will have the option to increase your share in the property.
We know that buying your first home can seem confusing and at times overwhelming. However, we are here to help. Book a no-obligation consultation with a member of our property team and be sure that you are on the right footing for a smooth and successful purchase.