Help to Buy mortgage guarantees help hundreds of borrowers move home
Almost 750 borrowers have bought a new home using the Help to Buy mortgage guarantee scheme, according to new figures.
The data was announced by Downing Street today and is based on completed mortgage applications with Lloyds Banking Group and RBS.
The Help to Buy mortgage scheme was introduced three months earlier than anticipated in October and aims to help people buy homes with a deposit of as little as 5 per cent.
A further 6,000 people have made offers on properties, it suggested.
It comes after the business secretary Vince Cable called for the scheme to be re-examined, saying: “There is a raging housing boom in London and the South East – not in other parts of the country.”
He said the boom could get “out of control” unless interest rates were raised – but doing this would “hit those parts of the country which are not yet fully recovered”.
The Government’s mortgage guarantees officially start today. However, banks were able to start offering the loans from the beginning of October last year as it would have been technically impossible to default on the home loan during these last three months.
The mortgage guarantees are the second phase of the Government’s Help to Buy scheme. The first phase was introduced last April and provides a Government loan of up to 20 per cent of the value of a new build home, interest free for the first five years.
In November, the Government said the Help to Buy equity loan scheme helped 5,375 buyers during its first six months.
Participants bought properties with an average value of £194,164, with the average equity loan being £38,703, according to the official figures issued by Communities and Local Government.
The majority of homes bought as part of the equity loan scheme were made by first-time buyers, totalling 92 per cent. It means the Government issued £208m in equity loans.
The Help to Buy equity loan scheme had only been available in England and Scotland, but the Help to Buy equity loan launches in Wales today.
Entry filed under: General News, Help to Buy. Tags: Department for Communities and Local Government, downing street, england, equity loan, Help to buy, Help to Buy Scheme, Lloyds Banking Group, mortgage guarantees, Mortgage loan, Vince Cable.