Share to Buy Expert Sessions: Your questions about Help to Buy

Answering your questions about Help to Buy!

Help to Buy

What is the interest rate on Help to Buy after the five year interest free period?
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Response from Censeo Financial – In year six you will pay 1.75% of the equity loan amount, split equally between the 12 months of the year. After that the figure will increase by RPI +1%.

So on a £240,000 equity loan – which is the maximum you can be given in London – the payment in year six will be £350. In year seven, if the RPI is 3%, then the payment would go up by 4% and would be £364.

Is it necessary to have a mortgage on a Help to Buy home?
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Response from Censeo Financial – No. You do not need to take a mortgage on a Help to Buy property, as long as you can pay the rest with your deposit. If you can get a mortgage then it may be better for you to take a lower equity loan. However, you will need to speak with an adviser in order to work out which option is best for you.

Is it easier to obtain a mortgage with Help to Buy or Shared Ownership?
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Response from Censeo Financial – If you are eligible and you have the affordability, then there is no difference in difficulty between obtaining a mortgage on a Shared Ownership home or a Help to Buy property.

I have loans, a credit card and overdraft. Will I still be able to buy through Shared Ownership?
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Response from Censeo Financial – It will depend on the size of those loans and credit cards, because they will come into play in terms of working out affordability. However, it will not completely rule you out.