What’s different about the new Help to Buy Equity Loan scheme?
The new Help to Buy Equity Loan scheme is running from April 2021 to March 2023, and has some major differences compared to the previous scheme:
- Only first time buyers will be able to use the new Help to Buy Equity Loan scheme.
- New regional price caps will be introduced. As a result, the maximum value of homes that can be bought with the scheme's help will be dramatically cut in most areas. The caps have been set at 1.5 times the average first time buyer price in each region (as of Autumn 2018).
What are the regional price caps?
| Region |
Price Cap |
| North East |
£186,100 |
| North West |
£224,400 |
| Yorkshire and The Humber |
£228,100 |
| East Midlands |
£261,900 |
| West Midlands |
£255,600 |
| East of England |
£407,400 |
| London |
£600,000 |
| South East |
£437,600 |
| South West |
£349,000 |
What are my other options?
While Help to Buy has been popular with first time buyers, it’s not the only route available if you have a small deposit.
- 95% mortgages: The average rates on mortgages that require just a 5% deposit have reduced significantly in recent years. This has made them considerably cheaper. And unlike with the Help to Buy Equity Loan scheme, you won’t be restricted to new build properties. However, as James explains above, you may struggle to get a high loan to value mortgage on a new build property.
- Shared ownership: Also known as ‘part buy, part rent’, this scheme allows you to buy a share of a property and pay rent on the rest. And as you'll only need a mortgage for the share you’re purchasing, you'll need a much smaller deposit than if you were buying the home outright. Find out more about shared ownership here.
- Guarantor mortgages: This is when a parent or close family member uses their own property or savings as security against your loan. This means lenders may accept a smaller deposit than usual and sometimes they won’t require any deposit at all.
Want to explore your buying options? Want to use a remortgage to fund an extension / renovation? No matter your goals, Resi Finance is here to help. Working in partnership with Mortgage Advice Bureau, we're able to offer free consultations to all homeowners - current and perspective. Book yours here.
