Has “Help to Buy” Been Scrapped?

On the evening before our “Help to Buy” seminar last week (which was a fantastic success, thanks to all who attended!) it was announced across many news outlets that a recently introduced Government scheme aimed at increasing lending to home buyers had been scrapped. 

We received many enquiries the next morning which questioned whether it was the “Help to Buy” scheme that was no longer available. Fortunately, it was not the “Help to Buy” incentive that has been axed. It was the “Funding for Lending” that is no longer available.

As confusing as it is, the “Funding for Lending” scheme was a completely separate incentive which was designed to incentivise banks and building societies to boost their lending to the UK real economy. Therefore, it was not advertised directly to the general public. The “Funding for Lending” scheme actually started in July 2012. After an extension to the scheme in August 2013, it was supposed to run up to 2015 but amid fears of creating another property bubble, the scheme has recently been scrapped.

This means that the “Help to Buy” scheme is absolutely still available and it should certainly be on the agenda of anybody that is looking to purchase a property. We find that even though the scheme could provide a huge boost to the property market, and an incredibly useful helping hand to home buyers, very few people actually know what it is about and there are a lot of misconceptions.

Here are some quick facts about the “Help to Buy” scheme:

• There are actually two different variations of “Help to Buy”. One is for new build properties only and consists of a 20% equity loan on the value of the property. The other is available on all properties (providing you have no other property interests) and allows purchases with just a 5% deposit.

• The “Help to Buy” scheme is not just for first time buyers. It’s for anybody that is looking to purchase a property in which they intend to live.

• The first Help to Buy (Equity Loan) has proved very successful with 12,500 arrangements made under the scheme by the end of August 2013. It’s available for properties up to the value of £600,000.

• The Government has targeted 74,000 purchases using the Help to Buy scheme by 2016.

If you missed out on our “Help to Buy” evening and you would like to find out more about the Government backed incentive, please feel free to get in touch with any of our local branches. We can even get you booked in for a no-obligation appointment with one of our expert mortgage advisers. Just visit our contact page at Hannells.co.uk

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