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Mortgage & Insurance Advisors
Opening Times: Mon. to Fri. 9.00am - 6.00pm, Sat. 9.00am - 5.00pm, Sun. - contactable 10.00am - 2.00pm
Nature of Business: Independent Mortgage & Insurance Advisors
Personnel: Stewart Pitt
What is Help to Buy?
The latest scheme announced by the government this week is actually Phase 2 of the help to buy initiative.
Phase 1 of the scheme is only available to people buying a brand-new property.
The reason everybody is so excited about Phase 2 is that it will help borrowers looking to buy any property, newbuild or resale, or to remortgage an existing property.
So how does it work?
The Help to Buy Guarantee Scheme will allow people to take out a mortgage of up to 95% of the value of the property they are buying or remortgaging.
Up until now mortgage lenders have been reluctant to lend at 95% loan to value as it is seen as more risky than lending at lower loan to values.
Under the Help to Buy Scheme the Government will guarantee a further 15% of the mortgage loan to the lender. This makes it less risky for the banks as even if you don’t pay your mortgage and they have to repossess the property they are still likely to get most of their money back.
By reducing the risk faced by the lenders the banks will be more keen to lend at higher loan to values, hopefully with lower interest rates than seen previously.
Who does this help?
First-time buyers who don’t have a big deposits to get on the property ladder
Second time buyers don’t have much equity in their current property but are looking to move
Existing borrowers previously trapped in High Loan to Value mortgages to remortgage to a better rate.
We are receiving a lot of enquiries about the new scheme already. We will post more information as it is released.
In the meantime you can contact us now to book a FREE CONSULTATION with one of our expert advisors.