Help to Buy came to an end in March 2023, but there are a number of alternatives from shared ownership to Lifetime ISAs that can bridge that gap and help first time buyers get a foot on to the property ladder. Here’s a handy list of alternatives for first time buyers and how these options work
Shared Ownership
Shared ownership allows you to buy a share – usually between 25 to 75% – of a property and pay rent on the remainder.
Crucially, this means that buyers can get on to the property ladder with a significantly smaller deposit and mortgage. It also means that overall monthly outgoing payments are often lower than if you were to rent privately or buy a property on the open market.
You’re then able to incrementally increase your share of the home up to 100% through a process called staircasing, should you wish to.
Learn more about shared ownership here
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Deposit Boost mortgage
Deposit boost mortgage is ideal for those struggling to save for a deposit. It enables you to borrow a higher percentage – usually an additional 5 to 20 of the purchase price – than available through a standard mortgage. This scheme is also beneficial for those with a smaller deposit who are looking to climb the property ladder to a more expensive home.
First Homes scheme
Depending on your where you live, first time buyers may be eligible to buy a home for 30% to 50% less than its market value. It is only applicable for specific new build homes or if buying from someone else who originally bought it as part of the scheme.
Currently the scheme is only available in England and essential workers and those living locally get priority. More information is available at gov.uk/first-homes-scheme.
Family Springboard Mortgage
Family springboard mortgage allows you to borrow up to 100% of the property value with help of a family member. It works well if you don’t have savings on hand for a deposit, but a friend or family member is willing and able to put up a lump sum (usually 10% of the purchase price) as security.
The buyer is still responsible for repaying the mortgage, and the family member will get their lump sum deposit back with interest – provided that you’ve kept up with your payments.
Lifetime ISA (LISA)
The Lifetime ISA is a savings account designed to help you save for your first home or retirement. You can save up to £4,000 per year and receive a 25% bonus from the Government. This means that for every £4 saved, the Government will add an extra £1 – up to a maximum bonus of £1,000 per year.
More information on these Help to Buy alternatives can be found at landgah.com/latest-news/help-to-buy-alternatives-for-first-time-buyers/
First Time Buyer is an exciting bi-monthly glossy which takes a stylish and comprehensive look at all the options available, setting them out in an entertaining and informative way, and helping potential customers navigate their way through what is often a daunting and complex process. We dispel the myths, reinforce the facts and arm the reader with the tools necessary to make their homeownership dreams a reality.
