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Help to Buy scheme for equity loans hits record numbers for June

The government’s Help to Buy scheme has hit record levels in June for the equity loan part with 4,745 completions.



Started in April 2013, the Help to Buy scheme has now completed on 56,402 properties with loans by the government valued at £2.4 billion with June being a new record with 4,745 valued at £220 million.

The total value of properties purchased over the last 27 months by first time buyers and home movers is £12.2 billion and for June alone is £1.1 billion.

Part two of Help to Buy is the mortgage guarantee scheme with 56,401 property completions compared to 56,402 for part 1 equity loans.

Over £10 billion of mortgages have been advanced for the 112,803 Help to Buy scheme buyers in addition to the loans secured from the government.

How do Help to Buy schemes work

The government set-up the first part of Help to Buy scheme giving an equity loan of 20% of the property value interest free and available on new build properties only.

It can be accessed by first time buyers and home movers with a small 5% deposit and the remaining 75% is provided by a mortgage from a lender for properties valued up to £600,000.

Phase two of Help to Buy is the mortgage guarantee scheme again for both first time buyers and home movers on both new-build and existing homes.

You only need a 5% deposit although you must arrange a 95% mortgage from a lender as the government has agreed with the lender to guarantee them 15% of the property value, rather than provide you with a loan.

Properties can be valued up to £600,000 but these schemes are not available for second homes, switching remortgage buyers or for buy-to-let properties.

Help with the deposit for a new home can come from family members as the equity release buyer can access cash using a lifetime mortgage and give to a child or grandchild.

Majority of buyers outside London

The Help to Buy scheme has been hailed a success by George Osborne with the equity loan part more popular outside London. Of the total 56,402 completions only 3,128 or 5.5% were in London Boroughs with loans of £194 million.

For the other 36 built-up metropolitan districts such as Liverpool, Manchester Newcastle the number of completions were 12,032 with a value of £402 million.

There are a total of 56 unitary authorities such as Bedfordshire, Cornwall, Wiltshire, Peterborough and Kingston upon Hull with completions of 15,821 and a value of £644 million.

The majority of equity loans were for the 201 Shire districts such as Aylesbury Vale, Colchester, Horsham, Ashfield and Northampton with the largest number of completions of 25,421 and a value of £1.2 billion.

Help to Buy schemes will continue until 31 March 2020 for the equity loan part and 31 December 2016 for the mortgage guarantee part.

What are your next steps?

Speak to our LCM mortgage advisers if you are planning to move home, buying your first home, remortgaging your existing home to a new cost effective mortgage deal or are a buy-to-let investor.

Learn more by using the mortgage cost calculators, equity release calculator and property value tracker chart. Start with a free mortgage quote or call us and we can take your details.

For equity release buyers our London City Mortgage brokers can recommend lifetime mortgages allowing you to receive cash from your property to help maintain your standard of living as costs rise.

Use your dashboard to access online mortgage quotes, money off vouchers and start your mortgage application online 24/7 on desktop, tablet or smartphone.


Mortgage Best Buys

These are examples of mortgage products we can approach with many more offering interest rates and flexibility to meet your needs.

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2-Years Time
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  • IMPORTANT

    Equity Release may involve a Lifetime Mortgage or a Home Reversion Scheme. To understand the features and risks, please ask for a personalised illustration. Equity Release may affect your entitlement to means tested state benefits and will impact on the size of your estate. For Equity Release London City Mortgages charge a fixed fee upon completion of £695. For Mortgages a fixed fee is charged on application. Typically this is from £295 up to £495 for the services selected.

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