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Help to Buy

Whether you are looking to get onto the property ladder or simply move to a new home from your existing house, Help to Buy could make a new home more affordable than you think.

With Help to Buy you’ll only need a 5% deposit. You pay just 80% of the price now and the remainder is funded by a 20% equity loan from the Government. 

  • Take a conventional 75% mortgage - so 100% homeownership for 80% of the price.
  • The remainder is funded by a 20% equity loan provided by the government.
  • No interest on the loan amount for the first five years.
  • Only available on a brand new home.

Am I eligible?

Help to Buy is available to buyers of new build homes only. You must be able to provide a 5% deposit and fund up to 75% of the selected property through a conventional mortgage. The maximum purchase price is £600,000. The Purchase must be your only residence.

When do I repay the outstanding loan amount?

The equity loan is repayable either when you sell your home or after 25 years, whichever is sooner.

Is there any interest on the loan?

You don’t need to pay any interest on the loan for the first five years. After 5 years an annual fee of 1.75% will be levied, payable in monthly instalments. This will increase annually by RPI plus 1% p.a.

What happens if property values fall?

(using the above example) 20% of the property market value is repayable, whether the value is more or less than the original purchase price.

Can I make partial repayments towards the balance of the loan?

Yes, partial repayments or “staircasing” to reduce the value of the loan can be made at any time. The minimum voluntary repayment is 10% of the market value of your home at the time of repayment.

Typical Example based on 20% loan

Purchase your home at £400,000. 80% is payable at the time of purchase (75% mortgage plus your 5% deposit) with the remaining 20% (£80,000) lent to you by the government through the Homes and Communities Agency (HCA).

If you sell your property at £420,000 THEN 20% (&pond;84,000) is payable to the HCA.

If you sell your property at £360,000 then 20% (£72,000) is payable to the HCA.

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For more information view the Help to Buy buyers guide.

Terms and Conditions:

Help to Buy is equity loan assistance to home buyers from the homes and Communities Agency (HCA). Help to Buy is subject to status, availability and Rectory Homes terms and conditions. You will need funds available to pay a reservation fee, stamp duty where applicable, legal and survey fees. Your new home must be your primary home and place of residence. You cannot sublet your home or buy a second home with the Help to Buy scheme. A monthly management fee of £1 per month is payable to the HCA from the start of the loan. Not in conjunction with any other offer. If you are in any doubt about this scheme please seek independent financial advice. Rectory homes does not sell mortgages or provide financial advice. 

YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE OR ANY DEBT SECURED ON IT.