Posted on Mar 19, 2014 in Property
Posted on Mar 19, 2014
Help to Buy 2 is a scheme designed to encourage lenders to offer more mortgages to those who have sufficient incomes to repay a mortgage Help to Buy 2 is a scheme designed to encourage lenders to offer more mortgages to those who have sufficient incomes to repay a mortgage, but are struggling to get a deposit together. It's available on any type of property (not just new builds) for those with a 5% deposit and you'll own it outright.
This 'mortgage guarantee' scheme provides an insurance policy for mortgage lenders, therefore, if you have a 5% deposit and the property is worth less than £400,000 in Scotland, £600,000 in England/Wales, the government will insure the next 15% for the lender in case of problems.
As lenders are taking the same risk as if you had a 20% deposit, they can offer more mortgages at 95% LTV than they would've done.