New build home buyers can now benefit from news that many lenders are now funding 95% mortgages following the end of the Government’s Help to Buy Mortgage Guarantee Scheme.
The scheme, which was aimed at the second hand market, closed to new mortgage applications on 31 December 2016.
The Chancellor Philip Hammond made the decision to end the scheme on the planned date, saying that its specific purpose had been successfully achieved. He said that the market had now become considerable less reliant on the Mortgage Guarantee Scheme with more than 30 lenders who now offer 90 – 95% mortgages independent of the scheme.
The Help to Buy Equity Loan Scheme is still available for any new build buyer with a deposit of at least 5%. The Government will lend customers up to 20% of the property price interest free for the first five years. The loan allows buyers to access cheaper mortgage products with only a 75% mortgage requirement from their lender. This scheme is open to any customer buying a new build property and only applies in England and Wales.
However new build buyers can now also benefit from the 95% mortgages, meaning customers can purchase a new build property with only 5% deposit without using Help to Buy.
Benefits to customers include the ability to buy a new property without having sold their current property and also that they can secure a 95% mortgage and Part Exchange their home – subject to specific terms and conditions – which is one of the restrictions of the Help to Buy Equity Loan.
Contact your financial advisor for more information about how you can secure your dream Story Home with a 5% deposit.
Disclaimer: All financial examples are indicative and subject to change. All information in this article is provided as generic advice and Story Homes accepts no responsibility for action taken as a result. Contact a recommended financial advisor for expert advice.