The new Help to Buy Equity Loan scheme for first-time buyers has been announced by the government. This could be a massive boost for those who are wishing to buy their first home within the next year. For the first 5 years, the equity loan will be interest free and it will apply to newly built homes only with a cost of up to £600,000.
You will be able to apply for this scheme from Wednesday 16th December 2020 if you are a first-time buyer. This will allow eligible buyers to reserve their homes from December with a move-in date planned for the 1st April.
Under the scheme the government will be lending new homebuyers up to 20% of the overall cost of a new build, in London, this will be increased to up to 40%.
In certain regions, the scheme will have price limits that will be set at 1 and a half times the average price of a first-time buyer price depending on the region. This should reduce how much first-time buyers borrow by keeping the average prices down in each region.
Will German the Director of Help to Buy at Homes England has said “Help to Buy has already helped more than 270,000 people into homeownership and 82 per cent are first-time buyers. The new Help to Buy builds on this success with first-time buyers in front of mind”
“We’re pleased we can help homebuyers with small deposits to own a home, at a time where there are fewer options open to them.”
More information about the Help to Buy Equity Loan Scheme can be found here.