Which Government
Support & Schemes
are available to help
First Time Buyers?
Helping to Save
Lifetime ISA
A Lifetime ISA is a great flexible, affordable way to save for a deposit and invest for your first home or later life.
You can open one if you are between 18 and 39 years old.
Why Choose a Lifetime ISA?
- Allowance – You can contribute up to £4,000 each tax year.
This forms part of the overall £20,000 ISA annual allowance, so if you put in the full £4,000 you can put up to £16,000 in other ISAs.
- Tax – any growth is free from UK tax. Tax rules can change and their benefits depend on your circumstances.
- Bonus – get a 25% bonus on contributions.
You effectively get £1 extra for every £4 you save.
Maximum Bonus per year £1000
Withdrawals other than purchase of first home or at 60 years old will usually mean a 25% government charge, so you could get back less than you put in.
What is the maximum that my property can cost to qualify for a government bonus?
To qualify for a government bonus, the property you are buying must have a price of £250,000 or less and you MUST be a first time buyer.
(in London there is a higher price limit of £450,000)
Further information can be found at helptobuy.gov.uk
Helping to Buy
Help to Buy: Equity Loan
Support for borrowers with a deposit between 5% to 20%.
Available for first time buyers in for on new homes in England.
Who is it for?
First time buyers in England looking to buy a new build home with a minimum of 5% deposit.
How does it work?
The Equity Loan is interest free from the government for the first 5 years although there is a £1 management fee via direct debit, after that you will start paying interest on the equity loan.
The value you pay back depends on the market value of the property when you pay back the loan.
You can repay all or part of your equity loan at any time. A part payment must be at least 10% of what your home is worth at the time of repayment.
Government has an equity share of up to 20% (up to 40% in London), until you make a repayment on the equity loan.
Example: on a £200,000 new home
First Time Buyer Deposit 5% (£10,000)
Help to Buy Equity Loan: 20% (£40,000)
Mortgage needed: 75% (£150,000)
The last date homebuyers can reserve homes and apply for the Help to Buy: Equity Loan is 31 October 2022.
This should allow enough time for homebuyers to legally buy their homes before the scheme ends on 31 March 2023.
Make sure your homebuilder is registered for Help to Buy before you apply.
At Gloucester Mortgage Centre we can advise you with options available for you based on your individual circumstances.
Further information about the scheme can be found at ownyourhome.gov.uk
Helping to Buy
Shared Ownership
The size of your deposit will be determined by your mortgage provider’s terms and conditions, but it will typically range from between 5% - 25% of the value of your share.
Who is it for?
Designed to help people to get on the housing ladder with a smaller mortgage and deposit. Maximum household income outside of London is £80,000
How does it work?
If you can’t afford all of a deposit and mortgage payments for a home that meets your needs, Shared Ownership offers you the chance to buy an initial share of a home worth between 10% and 75% of its market value.
You will pay rent to the housing provider on the rest.
You can purchase addition share of the property to increase the your share of the home that you own through staircasing from 10% of the homes market value at the time of staircasing.
Further information about the scheme can be found at ownyourhome.gov.uk
Helping to Buy
First Homes Scheme
Support for borrowers with a minimum 5% deposit.
Available for first time buyers stay in their local area.
Who is it for?
First Homes is a new scheme designed to help local first time buyers and key workers onto the property ladder.
How does it work?
Homes discounted are by at least 30% compared to market prices.
In some areas the discount could be as high as 50%, providing even greater savings.
The discounts will apply to the homes forever meaning that generations of new buyers and the local community will continue to benefit every time the property is sold.
First Home properties should, in time, be available throughout England.
A programme of 1,500 First Homes is being rolled out over the next 2 years in over 100 locations across England.
First Homes should also start becoming available on new construction sites across England as developers and local authorities begin to incorporate new planning policies.
Further information about the scheme can be found at ownyourhome.gov.uk
Helping to Buy
Mortgage Guarantee Scheme
Support for borrowers with a 5% deposit.
Available for first time buyers and existing home owners.
Who is it for?
Households looking to buy with a 5% deposit on properties costing a maximum of £600,000 to apply for a 95% loan to value (LTV) mortgage with participating lenders offering a government backed mortgage guarantee scheme.
How does it work?
The guarantee compensates mortgage lenders for a portion of net losses suffered in the event of repossession.
The guarantee applies down to 80% of the purchase value of the guaranteed property covering 95% of these net losses.
The lender therefore retains a 5% risk in the portion of losses covered by the guarantee. This ensures that the lender retains some risk in every loan they originate.
The mortgage guarantee scheme was launched on 19 April 2021 to help increase the amount of 5% deposit mortgages available for credit-worthy households by supporting lenders to offer these products through a government backed guarantee on new 95% mortgages.
The scheme is due to run until 31 December 2022.
Not all lenders participate in the scheme. At Gloucester Mortgage Centre we can advise you with options available for you based on your individual circumstances.
Further information about the scheme can be found at ownyourhome.gov.uk
Time to make your home ownership dreams a reality?
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To book your free initial consultation and begin your mortgage application process please contact us to arrange an appointment at a time to suit you. This can be face to face or via video call.
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