Help to buy scheme changes explained

Help to buy scheme
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Help to buy is a fantastic scheme.

As you know, the help to buy equity loan scheme has helped thousands of first-time buyers as well as home movers to move to their dream home worth £600,000 just with just a 5% deposit.

This scheme is replaced with the new scheme bit effect from 1st April 2021.

However, applications for the current scheme will close on 15th December 2020. Therefore, you have a tight deadline between now and then if you want to make use of the existing scheme.

There are 2 main advantages in the current scheme.

Advantage Number 1

You can purchase a Property worth up to £600,000 in England.

From 1st April 2021, this upper cap will be replaced with a regional cap for property outside of London. But the upper limit will remain the same if you are looking for a property around London.

Therefore, if someone is looking to buy a slightly expensive property outside of London may miss out after the 31 March 2021 delaine. You are unlikely to be affected if you are looking to buy around London.

Advantage Number 2

The current scheme is open for both home movers and first-time buyers.

The new scheme will only be available for first-time buyers. This is a massive advantage for a home mover to step up the property ladder.

Therefore if you are a home mover who wants to buy a property worth up to £600,000 you have a tight deadline. You need to make sure your application is submitted by 15th December 2020 to benefit form the existing scheme.

If you make use of this scheme along with the benefit of the stamp duty holidays you may save some money on the stamp duty too.

For contractors wanting to make use of the current outside IR35 contracts, this will be a good opportunity as you can secure a mortgage with the current day rate with most lenders. If you are inside IR35 and have to work through an umbrella company of a Fixed term contract your options may be limited after 31 March 2021.

Remember all new builds may not qualify under the help to buy scheme; therefore if you are interested in the current scheme, you may have to act fast.

As a mortgage is secured against your home or property, it could be repossessed if you do not keep up the mortgage repayments.

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