Help to buy 5% deposit

[BlackST]

Just a general question really.
Has anybody used the help to buy scheme?

Say I want to purchase a house for £110k.
If I save up £7k would the government lend me £7k to make up the 10% deposit?
Also for the £100k mortgage, how much before tax would need to be earnt to be able to borrow this much?
It would be just me applying for the mortgage.

Bit vague I know I just want a rough idea.

[GrumpyTwig]

For 100k about £20k PA but it's borderline if you plan to enjoy life, from past experience.

[BlackST]

Thanks for the quick reply. Earning over £20k.
I'm in a relationship but the application would be just me.

[Sarnie]

The Government doesn't borrow you 5%, it's just a standard 95% mortgage, with a guarantee in the background provided to the lender from the Government. So, at £110k you are going to need a £5,500 deposit and subsequently a £104,500 mortgage.

It's all a bit of a farce really as there are standard 95% mortgages with lower rates than the HTB 95% products........

[BlackST]

Sarnie said:

The Government doesn't borrow you 5%, it's just a standard 95% mortgage, with a guarantee in the background provided to the lender from the Government. So, at £110k you are going to need a £5,500 deposit and subsequently a £104,500 mortgage.
It's all a bit of a farce really as there are standard 95% mortgages with lower rates than the HTB 95% products........

Ah ok.
I weren't sure there were 95% mortgages available anymore, especially with better rates than the 5% interest rate Natwest are quoting on their site?

It's information i'm gathering as i'll be saving the next 8 months, I hope to be able to put an offer in for an house before Christmas time.

[Sarnie]

BlackST said:

Ah ok.
I weren't sure there were 95% mortgages available anymore, especially with better rates than the 5% interest rate Natwest are quoting on their site?

It's information i'm gathering as i'll be saving the next 8 months, I hope to be able to put an offer in for an house before Christmas time.

95% mortgages never went anywhere, they have always been available, just with smaller lenders.

And yes, there are better rates available than 5%............

[BlackST]

Sarnie said:

95% mortgages never went anywhere, they have always been available, just with smaller lenders.

And yes, there are better rates available than 5%............

I'll get in touch nearer the time then if that's possible.
Thanks for the help.

[z4chris99]

it really angers me this HTB scheme and low interest rates, its setting people up for the fall..

government win votes by getting everyone into homes at the detriment of savers,

interest rates go up (they have to)

savers who have 5% deposits and just about make repayments are now fked

default on their homes

HTB stump up the 5% (more when the market crashes and they are all in neg equity)

taxpayer loses once again

[DMN]

I thought the HTB scheme was the government putting in 20% of the deposit? ie the buyer puts in 5%, the Government 20%, so the buyer only needs a 75% mortgage?

The Wife and I are hoping to buy our first house this year, if things go to plan. So any experience people have of this scheme, I'm all ears.

[BlackST]

Chris, who is struggling to pay the repayments that you know?
I'll be able to pay repayments, easily. Easily if the interest rates rise to 8-9%. I wouldn't be looking to buy an house otherwise.

Help from the government would help me get into an house upto a year sooner, i'd prefer that.

[z4chris99]

I wasn't using you as an example, and it's more pronounced in London where people are buying 350-500k homes...

but yes I see people biting off more that they can chew, friends of mine

[GrumpyTwig]

DMN said:

I thought the HTB scheme was the government putting in 20% of the deposit? ie the buyer puts in 5%, the Government 20%, so the buyer only needs a 75% mortgage?

The Wife and I are hoping to buy our first house this year, if things go to plan. So any experience people have of this scheme, I'm all ears.

There's two schemes, you describe the equity loan one. Previous posts are about the guarantee scheme. The equity loan is only for new builds and is the one you end up just needing a 75% mortgage.
After 5 years you become liable for the interest on the loan but the idea, as far as I grasp it is to hopefully be in a better position after those 5 years and remortgage the whole amount.

[DMN]

Ah I see, for some reason I thought they where the same thing.