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Government Schemes

You may be able to get financial help through a government home ownership scheme if you live in England and can't afford to buy a home.

The 6 types of home ownership schemes are:

Help to Buy: Equity loans

Equity loans are open to both first-time buyers and home movers on new-build homes in England with a purchase price up to £600,000.

You won’t be able to sub-let your home if you use this scheme. It must also be your only property.

How does it work?

With an equity loan:

  • You’ll need to contribute at least 5% of the property price as a deposit
  • The government will give you a loan for up to 20% of the price
  • You’ll need a mortgage of up to 75% to cover the rest

Example

For a property worth £200,000 Amount Percentage
Cash deposit  £10,000  5%
Equity loan  £40,000  20%
Your mortgage  £150,000  75%

You will have to make payments towards your mortgage straight away but you won’t be charged loan fees relating to the Equity Loan for the first 5 years of owning your home.

In the sixth year, you’ll be charged a fee of 1.75% of the loan’s value. After this, the fee will increase every year in line with the RPI plus 1%

Your Help to Buy agent will contact you before the fees start, to set up monthly payments with your bank. You’ll also be sent a statement about your loan each year.

Fees don’t count towards paying back the equity loan.

How to Apply

Contact the Help to Buy agent in the area where you want to live if you’d like to buy a home with an equity loan.

You must buy your home from a registered Help to Buy builder. Your Help to Buy agent should have a list of registered builders for you to choose from.

Selling your home and paying back the loan

You must pay back the loan after 25 years or when you sell your home - whichever is earliest. How much you pay back will depend on the market value at that time.

Example

Market value of your home Equity loan taken out Amount
Bought for £200,000 20% Borrowed £40,000
Sold for £250,000 20% Pay back £50,000

You can pay back part or all of your loan at any time. The minimum percentage you can pay back is 10% of the market value of your home. The amount you pay will depend on the market value at that time.

Example

Market value of your home Percentage Amount
Bought for £200,000 Borrowed 20% Borrowed £40,000
Value at time of payment £220,000 Paying back 10% Pay back £22,000

Once you have contacted your local Help to Buy Agent we can help you with every step of the mortgage process, so please call us on 02380 018109 or email info@tmp-mortgages.co.uk

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Help to Buy: Mortgage guarantees (available across the UK)

Mortgage guarantees helps you buy a home with a deposit of 5% of the purchase price. It’s open to both first-time buyers and home movers for new-build and older homes in the UK with a purchase price up to £600,000.

The guarantee is provided to your mortgage lender by the government - not to you.

To qualify for a mortgage guarantee, the home you want to buy must:

  • Have a purchase price of £600,000 or less
  • Not be a shared ownership or shared equity purchase
  • Not be a second home
  • Not be rented out after you buy it

The property doesn’t have to be newly built.

You don’t have to be a first-time buyer and there’s no limit on your level of income. But you can’t use Help to Buy with any other publicly funded mortgage scheme, or an interest-only mortgage.

How to apply

We can help you apply to any lender taking part in the scheme (currently):

Aldermore Bank
Bank of Ireland (Northern Ireland only)
Bank of Scotland
Barclays
Halifax
HSBC
Lloyds Bank
NatWest
Post Office
RBS
Santander
Virgin Money

The lender will check your credit status and whether you’re able to make the repayments before they offer you a mortgage.

We can help you with every step of the Help to Buy: mortgage guarantees process from start to finish, so please call us on 02380 018109 or email info@tmp-mortgages.co.uk

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Shared Ownership

Shared ownership schemes are provided through housing associations. You buy a share of your home (between 25% and 75% of the home’s value) and pay rent on the remaining share.

You will need to take out a mortgage to pay for your share of the home’s purchase price.  Many mortgage lenders will lend 100% of the share being purchased, subject to individual criteria being met, so this can be a great way to buy if you have little or no deposit.

You can buy a home through shared ownership if:

  • Your household earns £60,000 a year or less
  • You’re a first-time buyer - or you used to own a home, but can’t afford to buy one now
  • You rent a council or housing association property

Older people

You can get help from another home ownership scheme called ‘Older People’s Shared Ownership’ if you’re aged 55 or over.

It works in the same way as the general shared ownership scheme, but you can only buy up to 75% of your home. Once you own 75% you won’t have to pay rent on the remaining share.

Your local Help to Buy agent can help you with this scheme.

People with disabilities

Home Ownership for People with Long-Term Disabilities (HOLD) can help you buy any home that’s for sale on a shared ownership basis if you have a long-term disability.

You can only apply for HOLD if the properties available in the other Help to Buy schemes don’t meet your needs, eg you need a ground-floor property. Your local Help to Buy agent can help you with this scheme.

Buying more shares (Staircasing)

You can buy more shares in your home any time after you become the owner. This is known as staircasing.

The cost of your new share will depend on how much your home is worth when you want to buy the share. If property prices in your area have gone up, you’ll pay more than for your first share. If your home has dropped in value, your new share will be cheaper.

The housing association will get the property valued and let you know the cost of your new share. You’ll have to pay the valuer’s fee.

Selling your home

If you own 100% of your home, you can sell it yourself. When you put it up for sale, the housing association has the right to buy the property back first. This is known as ‘first refusal’ and the housing association has this right for 21 years after you fully own the home.  If you own a share of your home, the housing association has the right to find a buyer for it.

How to apply

To buy a home through a shared ownership scheme contact the Help to Buy agent in the area where you want to live so they can provide you with the application forms and a list of properties available.

Once you have contacted your local Help to Buy Agent we can help you with every step of the mortgage process, so please call us on 02380 018109 or email info@tmp-mortgages.co.uk

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Help to Buy: NewBuy

NewBuy lets you buy a newly built home with a deposit of only 5% of the purchase price.

To be eligible for NewBuy, your new home must be:

  • A new build – being sold for the first time or for the first time in its current form (eg. A new flat that used to be part of a house)
  • Priced at £500,000 or less
  • Your main home - you can’t use NewBuy to buy a second home or a buy-to-let property
  • Fully owned by you - you can’t use NewBuy for shared ownership or shared equity purchases
  • Built by a builder taking part in the scheme

To be eligible you must be either:

  • A UK citizen
  • Someone with the right to remain indefinitely in the UK

You don’t have to be a first-time buyer and there’s no limit on your level of income. But you can’t use NewBuy with any other publicly funded mortgage scheme.

How to apply

Check that there are properties available in the area you wish to live by going to http://www.newbuy.org.uk/what-to-do-next/

Then let us help you apply for a mortgage from an approved lender. The lender will check that you can afford to repay it, as they would for any other type of mortgage.  You could get a mortgage of up to 95% of the purchase price if the lender is satisfied and you meet all the criteria.

We can help you with every step of the mortgage process, so please call us on 02380 018109 or email info@tmp-mortgages.co.uk

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Right to Buy

Right to Buy allows most council tenants to buy their council home at a discount.

You can apply to buy your council home if:

  • It’s your only or main home
  • It’s self-contained
  • You’re a secure tenant
  • You’ve had a public sector landlord (eg. A council, housing association or NHS trust) for 5 years - it doesn’t have to be 5 years in a row

You can get a discount on the market value of your home when you buy it if you qualify for Right to Buy.

The maximum discount is £77,000 across England, except in London boroughs where it’s £102,700. It will increase each year in April in line with the consumer price index (CPI).

The discount is based on:

  • How long you’ve been a tenant with a public sector landlord
  • The type of property you’re buying - a flat or house
  • The value of your home

If you’re buying with someone else, you count the years of whoever’s been a public sector tenant the longest.

You’ll usually have to repay some or all your discount if you sell your home within 5 years.

You might get a smaller discount if you’ve used Right to Buy in the past.

There are different discount levels for houses and flats.

Houses

You get a 35% discount if you’ve been a public sector tenant for 5 years. The discount goes up by 1% for every extra year you’ve been a public sector tenant, up to a maximum of 70% – or £77,000 across England and £102,700 in London boroughs (whichever is lower).

Flats

You get a 50% discount if you’ve been a public sector tenant for 5 years. The discount goes up by 2% for every extra year you’ve been a public sector tenant, up to a maximum of 70% – or £77,000 across England and £102,700 in London boroughs (whichever is lower).

Your discount will be less if your landlord has spent money building or maintaining your home:

  • in the last 10 years - if your landlord built or acquired your home before 2 April 2012
  • in the last 15 years - if you’re buying your home through Preserved Right to Buy, or if your landlord acquired your home after 2 April 2012

To Apply you need to fill in the Right to Buy application form (RTB1 notice) and send it to your Landlord.  Your landlord must say yes or no within 4 weeks of getting your application (8 weeks if they’ve been your landlord for less than 5 years). If your landlord says no, they must say why. If your landlord agrees to sell, they’ll send you an offer. They must do this within 8 weeks of saying yes if you’re buying a freehold property, or 12 weeks if you’re buying a leasehold property.

You have 12 weeks after you get your landlord’s offer to tell them you still want to buy. The landlord will send you a reminder if you don’t reply to the offer. You have 28 days to reply to the reminder, or the landlord could drop your application. You can pull out of the sale and continue to rent at any time.

We can help you with every step of the Right to Buy Process, including the application to the Landlord, so please call us on 02380 018109 or email info@tmp-mortgages.co.uk

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Right to Acquire

Right to Acquire allows most housing association tenants to buy their home at a discount. You apply using the Right to Acquire application form.

You can apply to buy your housing association home if you’ve had a public sector landlord for 5 years. These landlords include:

  • Housing associations
  • Councils
  • Tthe armed services
  • NHS trusts and foundation trusts

You can get a discount of between £9,000 and £16,000 on the price of your property.

The amount of discount you’ll get depends on where you live in the UK.

Your landlord will tell you what discount you’ll get when you apply to buy your home. You can also download a table of discounts, broken down by location.

Your discount might be reduced if you’ve used Right to Acquire or Right to Buy in the past

Eligible properties

Your property must either have been:

  • Built or bought by a housing association after 31 March 1997 (and funded through a social housing grant provided by the Housing Corporation or local council)
  • Transferred from a local council to a housing association after 31 March 1997

Your landlord must be registered with the Homes and Communities Agency

The home you want to buy must also be:

  • A self-contained property
  • Your only or main home

Who doesn’t qualify

You can’t use Right to Acquire if:

  • You’re being made bankrupt
  • A court has ordered you to leave your home
  • You’re a council tenant – you may be able to use Right to Buy instead
  • You have ‘Preserved Right to Buy’

To apply you fill in the Right to Acquire application form and send it to your landlord. Your landlord must say yes or no within 4 weeks of getting your application (8 weeks if they’ve been your landlord for less than 5 years). If your landlord says no, they must say why. You can’t appeal against the landlord’s decision.If your landlord agrees to sell, they’ll send you an offer. They must do this within 8 weeks of saying yes if you’re buying a freehold property, or 12 weeks if you’re buying a leasehold property. Your landlord might offer you the choice of buying your home, or another empty one that they own. You don’t have to accept the other property and your landlord doesn’t have to offer you one.

Once you get your landlord’s offer, you have 12 weeks to tell them that you still want to buy. If you don’t reply, the landlord will send you a reminder (called an ‘RTA4’). You’ll have a reasonable time (at least 28 days) to reply. If you don’t, your landlord will send a final reminder (called an ‘RTA5’). If you don’t reply to that, your landlord can drop your application. You can pull out of the sale and continue to rent at any time.

We can help you with every step of the Right to Acquire Process, including the application to the Landlord, so please call us on 02380 018109 or email info@tmp-mortgages.co.uk

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