The mortgage market changes all the time, not just in terms of mortgage deals and regulation but also in the way lenders assess mortgage applications. We pride ourselves on being up to date with regulation, legislation and the economic market so we can pair this knowledge with your circumstances and match you to lenders. Current first time buyer mortgages include:
HELP TO BUY – EQUITY LOAN – FOR NEW BUILD PROPERTY
This is only available to buy a new build home. The most you can borrow is £600,000.
This is how it works. The government lends you up to 20% (40% within Greater London) of the cost of a new home, you add a 5% deposit, and borrow the other 75% from a lender. For example, a £200,000 home will break down as:
- A DEPOSIT FROM YOU OF £10,000
- A LOAN FROM THE GOVERNMENT OF £40,000
- A MORTGAGE FROM A LENDER OF £150,000
The attraction of this scheme is that the government loan is interest-free for the first five years.
LIFETIME ISA (‘LISA’)
What is a Lifetime ISA?
- A Lifetime ISA gives you flexibility in how you save and invest for your first home or later life.
- The Lifetime ISA is available to anyone aged between 18 and 39.
- The money can be invested in the stock market or you can save cash, just like any other ISA. The money can grow free from UK tax. The government will contribute 25%, up to £1,000 per year.
How Much can I contribute to a Lifetime ISA?
- The Lifetime ISA allows you to contribute up to £4,000 each tax year. The government will add a further 25%. In effect, for every £4 you save, you will receive an extra £1, up to £1,000 per tax year.
- Although you need to be aged between 18 and 39 to open a Lifetime ISA, you can still pay in and receive the government bonus, up to age 50.
Taking money out…
- 12 months after you make your first payment, you can use the money in your Lifetime ISA to purchase a property up to £450,000. Alternatively, you can wait until you’re 60 and release the money then.
- If you want to withdraw the money before you’re 60, the government usually charge a 25% penalty. This would leave you with less than you originally put in.