Prime Minister David Cameron insists the second phase launch of the ‘Help to Buy’ scheme will unlock the housing market for young first time buyers.
Help to Buy2 will see the Government underwrite lenders who provide mortgages at higher loan-to-value rates if the customer defaults on their repayments.
It is available for homes worth up to £600,000 but cannot be used by buy-to-let landlords looking to expand their property portfolios.
It will effectively see the Government guarantee up to 15 per cent of a mortgage and allow first-time buyers to buy a house, even if they can only raise a 5 per cent deposit.
HSBC, Royal Bank of Scotland, Lloyds, Halifax and Santander are all on-board with the scheme which was due to start in January but has been brought forward.
Mr Cameron said: “I am very content that we are going to get a good range of products in the market and that is going to help people who want to get on to the housing ladder, who want to own their own home, who can afford mortgage payments but can’t currently get mortgages.
“Those are the people we want to help.”
As reported in the Express, Mr Cameron visited a three-bedroom show home in Weston Favell, Northampton and met first-time buyers Kayleigh Groom, 28, and her partner Chris Day, 29, from Kettering.
The couple, who have been renting for five years, told him that Help To Buy would enable them to get on the property ladder.
Mr Cameron added: “What we’re doing is making sure that the typical family can buy the typical home.
“The couple I’ve just been with. They’ve both got good jobs. They’ve both got good prospects. They can afford mortgage payments but because they haven’t got a rich mum and dad they can’t get a mortgage. That isn’t fair. That isn’t right.
“So the Help To Buy scheme will help them to get a mortgage and make them homeowners.”
If you are buying or selling a house call the CQS-accredited property team at PM Law on 0114 2965444.