Sunday, 2 October 2011

FirstBuy: You could be one of the 10,000 first-time buyers to get help

FirstBuy is the government plan to help first-time buyers get onto the property ladder through an equity loan. This week is the time to register your interest.

If you’re struggling to scrape together a deposit for your first home then you may be eligible for help to buy through the Government’s £250m FirstBuy scheme.

Under FirstBuy, the Government and housebuilders will offer about 10,000 first-time buyers a 20 per cent equity loan – 10 per cent each from the government and the developer – to be spent on buying an approved new build property.

The scheme begins in September and is open to first-time buyers around the country who have a five per cent deposit, a combined household income of under £60,000 a year and who can’t afford the 25 per cent deposit required in most cases to secure a mortgage the conventional way.
The equity loan will be interest free for five years, but there will be a 1.75 per cent annual fee introduced on the loan from the beginning of the sixth year to be repaid monthly. The equity loan itself will not need to be repaid until the home is sold.

Housing Minister Grant Shapps confirmed that over 100 housebuilders will take part in the scheme, which also has the backing of key lenders including Nationwide, Halifax, Barclays and The Melton Mowbray Building Society.

"With 80 per cent of young first-time buyers depending on parental help, I am determined that we pull out all the stops to help those who want to take their first steps onto the property ladder,” Shapps said. "And because this help will be available on newly-built properties, it will also offer a much-needed boost to our housebuilding industry, supporting thousands of jobs across the country."

Anyone interested in registering for the scheme should do so through the UK Government's HomeBuy website.

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