Help to Buy Properties in Buckinghamshire
Help to Buy in Buckinghamshire
Help to Buy is a special program designed to help first-time buyers buy homes in different parts of the country, such as Buckinghamshire. The Help to Buy scheme is supported by the government. This means that when buying a new apartment or house, buyers can apply for a loan in the amount of up to 20% of the property's value. After they make a minimum deposit of 5%, they can get a mortgage covering the remaining 75% of the home's value. In 2021, the government Help to Buy program was changed. Previously, everyone could use the program, but now only first-time buyers.
Korter provides a special filter of Buying Schemes -> Help to Buy, where you can see all the properties that support the Help to Buy scheme in Buckinghamshire.
How does Buckinghamshire Help to Buy works?
Since only new properties are classified as Help to Buy Buckinghamshire developments, you can take advantage of a special program when buying a home in a new development. In this case, you get an interest-free loan for the first five years. Then, starting in the sixth year of living in the home, you will begin paying interest equal to 1.75% of the property's actual value. You also have 25 years to pay off the loan in full. If you sell your property before the 25-year timespan, you also need to pay off the loan. Therefore, the best advice on avoiding paying additional interest is to pay the entire amount within the first five years.
In addition, it is crucial to understand that it is the actual value of the property that affects the loan amount. If the value of the house rises or falls, Help to Buy equity loan will also rise or fall, respectively. For example, if the property price increases by 10%, then the interest rate you must pay will also increase by 10%. When considering purchasing Help to Buy Buckinghamshire properties, this must be kept in mind.
| Example of Help to Buy in Buckinghamshire | ||
| Cost of the home is £400,000 | ||
| Cost name | Percentage of total | £ value |
| Your deposit | 5% | £20,000 |
| Equity loan | 20% | £80,000 |
| Mortgage | 75% | £300,000 |
| TOTAL | £400,000 | |
What are the eligibility criteria for Buckinghamshire Help to Buy?
To participate in the Buckinghamshire Help to Buy program, you have to comply with the established rules.
Requirements:
- Be at least 18 years old.
- Be a first-time buyer, meaning that you have never owned other real estate or homes, either in the UK or abroad.
- Require at least a 5% deposit of the total purchase price of the house.
- The value of the real estate you are buying can not be more than the regional price cap for your area (see the full list of price caps below).
- You must be able to prove you can afford the mortgage repayments and other outgoings on the property you want to buy.
Not allowed:
- Owning a home or land anywhere in the world at any time.
- To have had any form of sharia mortgage finance.
- Owning a home bought with other people or inherited.
- Being married or in a cohabiting relationship, either now or on legal completion with anyone who owns or has owned a home or land anywhere in the world.
- Purchasing a second home.
Remember:
- Part Exchange is not available through the Help to Buy scheme.
- You cannot sublet your Help to Buy home.
Help to Buy Regional Price Caps
| Region | Help to Buy price cap |
| South East (Buckinghamshire) | £437,600 |
| North East | £186,100 |
| North West | £224,400 |
| Yorkshire and the Humber | £228,100 |
| East Midlands | £261,900 |
| West Midlands | £255,600 |
| East of England | £407,400 |
| London | £600,000 |
| South West | £349,000 |
Buckinghamshire Help to Buy Repayments
- The first five years after getting Help to Buy mortgages are interest-free, so it is recommended to repay the loan before the period ends. Failing this, annually in April, the interest on your equity loan will increase by the Consumer Price Index (CPI), plus 2%.
- In this way, in the sixth year, you will pay 1.75%, in the seventh year, the rate will be 1.75% + (CPI + 2%) (but if you took out a stock loan before December 2019, it will be + 1%), and so on. That being said, you will pay a £1 monthly fee for management by direct debit, as when you take out a stock loan, you agree to pay back the full, interest and management fees.
- Stamp Duty tax is a property transaction tax. The tax is due to be paid on any property which is purchased at a price of more than £125,000. However, in the Help to Buy scheme only first-time buyers do not need to pay Stamp Duty for properties up to £300,000.
Buckinghamshire Help to Buy pros and cons
If the buyer does not have all the necessary funds to purchase the new home, then the opportunity to buy one of the Help to Buy houses in Buckinghamshire through a government program might be tempting. But before opting for this program, you need to know everything about the advantages and disadvantages of the program.
| Pros | Cons |
| + Complete ownership. The buyer owns 100% of the purchased apartment or home. | - New homes only. Help to Buy houses do not cover resale properties. |
| + Deposit at a minimum. The buyer has to pay a 5% deposit of the total value of the house. | - Regional price cap. Each region features set prices, which should not exceed the purchased house. |
| + 5-year interest-free phase. The purchaser can manage to pay the price of the house during the first 5 years without interest on top at all. | - Not a fixed cost. If the housing price rises, the purchaser pays interest on the new value. |
| + Family revenue is not important. The purchase of Help to Buy homes does not provide for maximum family income restrictions. | - Growing interest. At the end of the interest-free period, the interest rate increases annually. |
| + 25-year term to pay off the loan. You have enough time before you have to repay the loan in full. | - Remortgage is a problem. Many remortgage deals are only accessible to those who have paid off their loan. |
| + Low mortgage rates. | - Reconstruction permit. Before you can start improving your property, you need to get a permit. |
Buckinghamshire Help to Buy. How to apply?
If you decide to become a member of the Help to Buy program, here is a small guide on how to do it:
- Make sure that the developer is registered under the scheme and book the desired apartment in the new building.
- Find the Help to Buy agent in your area and apply online.
- After evaluation of your eligibility, the Help to Buy agent will issue an Authority to Proceed.
- Authority to Proceed gives you a permit to apply for a mortgage and promote your application prior to exchanging contracts. After that, receive an Authority to Exchange issued by Agent Help to Buy.
- Get a Transaction Confirmation for further the legal completion of the construction and the transfer of funds to the development company. The Help to Buy agent will issue this confirmation when all documents and dates are agreed and the house is built.
- After completing the legal process, the Help to Buy agent passes your details to the loan administrator to manage the loan account until it is paid in total.
Popular locations for Help to Buy
Prices for new buildings in other cities
| Milton Keynes | from £349 / ft2 |
| Hertfordshire | from £567 / ft2 |
| Berkshire | from £456 / ft2 |
| London | from £937 / ft2 |
| Essex | from £415 / ft2 |
| Surrey | from £612 / ft2 |
| Kent | from £407 / ft2 |
| Manchester | from £366 / ft2 |
| Greater Manchester | from £334 / ft2 |
Prices for apartments in other cities
| Milton Keynes | from £214 995 |
| Hertfordshire | from £250 000 |
| Berkshire | from £225 000 |
| London | from £192 000 |
| Essex | from £225 000 |
| Surrey | from £155 000 |
| Kent | from £168 000 |
| Manchester | from £160 000 |
| Greater Manchester | from £125 000 |