Government Schemes to Help You Buy a Home in 2021

Blake & Thickbroom - Estate Agency in Clacton-on-Sea, Essex

There are a number of government schemes available to help you buy a home and the eligibility criteria has changed for some. Find out which you could be eligible for in 2021.

For some people, saving a deposit, securing a mortgage or finding the right home at the right price is such a struggle that they are priced out of buying on the open market.

If you’re in this situation, it is worth looking into the Government schemes on offer to help you get on the property ladder.

As a company, Blake and Thickbroom believe in offering help and advice whenever we can. Please take a look at the information below to find out more about the various schemes that are available.

Help to Buy: Mortgage Guarantee scheme

The government launched the new Mortgage Guarantee in the budget 2021 aimed to help buyers with a 5% deposit.

What you should know

  • This scheme allows you to get a mortgage with just a 5% deposit
  • The government has promised to underwrite 15% of the mortgage in the event that you default. As a result, mortgage lenders feel confident enough to offer you a 95% mortgage
  • The scheme applies to all types of properties (new build and old) that cost less than £600,000
  • First time buyers AND existing homeowners can apply
  • You must have a regular income and a good credit rating.

Help to Buy: Equity Loan (2021 – 2023)

Through a Help to Buy equity loan, the government will lend you up to 20% of the value of a property in the form of an equity loan – or 40% if you’re in London. You’ll have to find a 5% deposit and secure a mortgage to cover the remaining share of the property.

What you should know about Help to Buy:

  • Unlike its predecessor, it’s only open for first-time buyers and there are regional price caps ranging from £186,100 in the North East to £600,000 in London
  • There’s no salary cap or joint income limit applied, but an eligibility calculator will check monthly income and outgoings to ensure you can afford the mortgage repayments
  • You must buy your home from a housebuilder registered for the scheme

Help to Build

This scheme is to help self and custom builders get onto the housing ladder through lower deposit mortgages.  When the build has been completed, a government backed loan is made available, similar to the Help to Buy: Equity Loan scheme.

Shared Ownership (New Build)

This shared ownership scheme allows you to buy part of a new build property and rent the other part.

Over time you can buy more of the property, until you own the whole thing.

Shared Ownership (Resale)

The shared ownership resale scheme allows you to take over an existing shared ownership property that the current owner has put on the market.

Over time you can buy more of the property until you own the whole thing.

Lifetime ISA

A Lifetime ISA, or LISA, is a type of account designed to encourage people to save for their first home or their retirement.  You can save up to £4,000 a year and government will top this up with a 25% bonus.

Rent to Buy

You can rent a newly built home with the intention to buy, thanks to this government scheme

Right to Buy

If you live in a council house or flat you may be able to buy your home at a discount under the right to buy scheme.

The discount depends on where you live, how long you have lived there and whether you live in a house or flat.

Armed Forces Home Ownership Scheme

The Armed Forces Home Ownership pilot scheme (AFHOS) has now closed, and the government recommends considering other schemes outlined above – such as Help to Buy.

HOLD or Home Ownership for people with long-term Disabilities

HOLD is a specially tailored option to assist people with long term disabilities to purchase a home on a shared ownership basis.

If you’d like to find out more, please get in touch with our friendly team today on 01255 688788 and we’ll be happy to help.

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