HELP TO BUY

London Help to Buy Equity Loan Scheme explained
  • Only 5% deposit required
  • Government funding for up to 40% of the value of the property
  • Government contribution interest free for 5 years
  • Leaving mortgage for just 55% of the property value
  • Property being purchased up to £600,000
  • Open to First Time Buyers
  • 2021-2023 Available to First Time Buyers Only

What is London Help to Buy?

London Help to Buy is a government scheme designed to help you to get on to the property ladder in the London area. Help to Buy is an equity loan from the government of up to 40% of the value of the property you wish to buy, provided you have a 5% deposit, therefore requiring only a 55% mortgage on your new home.

What are the criteria for applying?

To use London Help to Buy, the property you are buying must:
• Be a new build
• Have a purchase price of up to £600,000
• Be the first property you own
• Not be let or sublet once purchased

Banks offering London Help to Buy

The majority of high street banks offer the scheme including: Aldermore, Bank of Scot- land, Barclays, Halifax, Leeds, Lloyds, Nation- wide, NatWest, Newcastle, Royal Bank of Scotland, Santander, Teachers and TSB.

How do I pay back my loan?

• You must pay the loan back after 25 years or when you sell your home whichever comes first
• You will not be charged interest on your 40% loan for the first 5 years of owning your home
• From year 6, a fee of 1.5% is payable on the equity loan, which rises annually by RPI (Retail Price Index) + 1%

How to Apply

You apply directly to the house builder for the loan and then apply separately for a mortgage via your chosen lender or mortgage broker, letting them know you intend using the London Help to Buy scheme.

Example Calculation

For more information, visit:

helptobuy.gov.uk/equity-loan/equity-loans

 


 

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